Middle-income tax dodgers face CPS crackdown

Simon Ward
by Lovemoney Staff Simon Ward on 21 January 2013  |  Comments 21 comments

The Crown Prosecution Service wants to increase its number of tax evasion cases going to court by fivefold over the next few years.

Middle-income tax dodgers face CPS crackdown

The number of tax evaders facing prosecution is set to dramatically increase, according to the head of the Crown Prosecution Service (CPS).

It wants a five-fold increase in the number of prosecutions, reaching 1,500 by 2014-15. And it will target middle-income professionals, with lawyers and plumbers among the professions named as under scrutiny by Keir Starmer, the director of public prosecutions.

People who run tax avoidance schemes, such as those used by a number of high-profile celebrities, will also face the prospect of court action. This marks the first sign of a real clampdown on these following several major newspaper investigations.

Experts say targeting these groups will lead to a higher number of convictions than from more challenging investigations into crimes such as cross-Europe smuggling.

The CPS's high strike rate

The CPS has handled prosecutions for HM Revenue & Customs since it was merged with the latter’s prosecution office in 2010. It currently has an 86% conviction rate on tax prosecutions. But this new target marks a change in direction, as HMRC previously didn't favour prosecutions in many cases.

The CPS estimates tax evasion costs each UK household £530 a year. The Government is investing a total of £1 billion in HMRC over this Parliament and wants to see a return of £22 billion a year by 2014/15.

The Government also wants to introduce a so-called General Anti-Abuse Rule as part of this year’s Finance Bill to make it easier to close avoidance schemes.

HMRC has already launched 'tax forces' look at professions including solicitors, street traders and taxi drivers, electricians and eBay traders and direct sellers such as Ann Summer party reps over the past year.

And last week it announced that 100 extra inspectors would be recruited to its Affluent Compliance Team, which targets high earners.

More on tax

How to make sure you’re on the right tax code

How to get your online self-assessment tax return right

Beware this tax scam

How to get a tax refund

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Comments (21)

  • oldhenry
    Love rating 343
    oldhenry said

    Just to put a it of reality into this, the Inland Revenue ( as it was when I was an accountant) often worked on 'tip offs'. These could be a neighbour , or another business person with whom you had a disagreement, writing to the IR saying you were concealing large amounts of income. This was enough to start an investigation and it certainly costs the taxpayer in accountant fees and legal fees ,if it went to court, which was extremely rare as the cases were often not provable. The IR hated it when it was shown the tip off was the result of malice as it was no brownie point for them and they would refuse to admit this whatever proof we could come up with. They wanted admission and a payment so they could 'bank' it with their bosses and the governmnet could say we have another tax dodger. I put the government agencies on the same footing as the cash- in- handers that buy yachts for cash and keep them in marinas in Spain, or Greece and they do, I know.

    Report on 28 January 2013  |  Love thisLove  0 loves
  • yocoxy
    Love rating 152
    yocoxy said

    It seems that every comments discussion becomes an attack on big bad corporations or those evil politicians, regardless of the article..

    It must be tough to spend so much time and emotional energy being angry..

    If you don't like Starbucks don't buy their products, if you want to influence politics either vote or even better join a political party and get yourself nominated..

    .. Or I suppose you could go to a financial website and rant.

    Report on 01 February 2013  |  Love thisLove  0 loves

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