HC Deb 16 May 1978 vol 950 c137W
Mr. Roderick

asked the Chancellor of the Exchequer (1) how much revenue was obtained from value added tax in the past year; and how much it cost to collect;

(2) how many civil servants he estimates would be needed to undertake the work done in calculating their dues by those who pay value added tax;

(3) how many civil servants are employed in the collection of value added tax.

Mr. Robert Sheldon

Net receipts of VAT in 1977–78 were £4,230 million—provisional. It is estimated that the total cost, including relevant overheads, of administering the tax in 1977–78 was about £85 million.

It is difficult to estimate the number of staff engaged in the administration of a particular tax or duty collected by Her Majesty's Customs and Excise because of the need to apportion the staff providing general support services to those staff who are directly concerned with the management and control of individual taxes and duties. However, on the basis of the latest detailed annual analysis—1977—of the functional use of the Department's staff, as modified by more up-to-date information about deployment of staff, the direct staff effort involved in management and collection of VAT is estimated to have been equivalent to approximately 9,870 man years. If allowance is made for staff engaged on administrative support work not directly attributable to VAT, the figure would be approximately 12,070 man years.

No information is available about the total time taken by VAT payers in calculating liability or the number of civil servants who would be needed to maintain traders' records and calculate their tax liability therefrom. But as I told my hon. Friend the Member for Woolwich, East (Mr. Cartwright) on 20th April 1977—[Vol. 930, c. 96]—a study of compliance costs is being conducted by a research team at the University of Bath.