§ Mr. Ridleyasked the Chancellor of the Exchequer what estimate he has made of the extra tax collected annually as a result of the introduction of the system of 714 certificates for sub-contractors in the building industry.
§ Mr. Robert SheldonI am afraid it is not possible to quantify the additional amount of tax collected on income from the construction industry as a result of the introduction of the sub-contractors' deduction scheme. However, in each of the two years 1974–75 and 1975–76 payments to sub-contractors of approximately £25 million are known to have been made incorrectly without deduction of tax as a result of fraud and misuse of documents. The comparable figure for the first six months of the new scheme, 543W which took effect from April 1977, was under £ ¼ million. It follows that the introduction of the new scheme appears to have reduced very substantially the loss of revenue in this field.
§ Mr. Ridleyasked the Chancellor of the Exchequer how many staff are employed by the Revenue, and at what cost, who are engaged in administering the vetting, issuing and monitoring of 714 sub-contractors' certificates and the vouchers which accompany them (a) to date and (b) for a future year.
§ Mr. Robert SheldonIn the current year, the equivalent of about 220 staff units are estimated to be employed on this work, at a cost of about £1 million. There are in addition 200 staff engaged on other aspects of the scheme. The need in future years will depend on several factors, including the level of activity in the construction industry, but there will continue to be a considerable saving compared with cost of administering the old scheme.