I think it worthwhile highlighting this comment posted by a loyal reader yesterday, in response to my article about CONNECT:
"Here we go again, La-La Land revisited.
Such short memories, we have forgotten the strong criticisms levelled at HMRC 'taskfarces'
How effective are the taskforces? HMRC tells Accounting WEB that since its taskforces have collected £200m in additional tax, which was previously undeclared.
Not bad, but to put this figure in context, it’s less than 1% of the £35bn UK tax gap - the difference between the tax HMRC thinks should be collected and the amount actually collected. Other estimates reckon the tax gap is £120bn.
Also, it’s not clear how many leads of alleged tax evasion the taskforces found but weren’t able to collect – because, say, the taxpayer went missing, or a business went bankrupt.
And we don’t know how much taskforces cost. HMRC didn’t reveal the cost of running the taskforces as “[each] one is slightly different”. It said about 350 staff will work on them this year.
One purpose of the taskforces is to deter tax evasion but this is hard to measure.
(Query - would this be of a similar nature to the Preventive effect of a uniformed Customs Officer? Pepys must be a turning in his grave!)
Those with long memories will recall the somewhat jaundiced view that was held of these taskforces by MP's who previously criticised them for incurring hidden expenses such as car hire, hotels, and whether removing staff from other areas was in fact resulting in further losses.
Perhaps the real reason for trumpeting their 'success' is to divert attention from the criticisms reported in the PAC report (see todays Daily Mail article 'Tax credit fraud and errors cost £1bn)? It would appear the idiots are paying out more to fraudsters than the meagre amounts their taskforces are collecting, albeit the low hanging fruit variety, eh Ken?!
Oh, and their Connect system ain't as connected as they say it is, and it also appears to have taken them more than a couple of years to work out what they can do with the information they have been holding for years. As for unannounced visits, any Compliance Officer or what were they called, LVOIT staff (local VAT Investigation Teams) will tell you all about the value of such visit and the use of Cash Teams which were all abolished by the management.
In any economic downturn, non-compliance and fraud increase, its a fact of life, therefore, the opportunities to harvest low hanging fruits and windfalls increase.
Ho, Hum, time for another waxer..."
Tax does have to be taxing.
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