§ Lord VAIZEY
asked Her Majesty's Government:942WA
Whether they will list (a) the amount of VAT unclaimed for each year since its inception; (b) the estimated rate of avoidance on VAT and (c) the estimated rate of evasion on VAT.
§ Baroness BIRK
(a) At the end of September 1978, the amounts of VAT due to the Exchequer but outstanding for each year since the inception of the tax were:
(b) and (c) It is not possible to estimate the extent of legal VAT avoidance or of fraudulent evasion; but Customs and Excise officers on control visits detect each year over £50 million in underdeclarations of tax (or over-declared repayment claims), an amount representing about 1 per cent. of total net receipts from the tax. An exercise conducted in 1975 suggested that at that time more intensive control of the tax might produce an additional £30 million net revenue but only at an unacceptable marginal cost of collection.
Financial Year Amount (£ million) 1973–74 … … 2.2 1974–75 … … 9.1 1975–76 … … 16.1 1976–77 … … 22.9 1977–78 … … 42.0