§ Sir Hugh Rossi
asked the Chancellor of the Exchequer if he will make a statement about the discussions between the Inland Revenue and the London Dressmakers and Allied Contractors' Association; and what conclusions have been reached.
§ Mr. Moore
[pursuant to his reply, 3 February 1984, c. 394]: Now that the London Dressmakers and Allied Contractors' Association has itself made public its discussions with the Inland Revenue, I am able to add to the reply which I gave to my hon. Friend on 9 November 1983.—[Vol. 48, c. 140.]
PAYE auditors of the Inland Revenue have been investigating certain employers in the dressmaking industry. The London Dressmakers and Allied Contractors' Association, which represents a number of employers in the industry, approached the Inland Revenue on behalf of their member firms to discuss the Department's approach to investigation in the industry. These discussions are continuing. The Inland Revenue has agreed that no new PAYE audit investigations on dressmaking employers belonging to the association will be started until the discussions are concluded, or until 31 March 1984, whichever is the earlier.
The purpose of the moratorium on new investigations is to enable the trade association to publicise to its members the need for employers to take steps on their own initiative to put their tax affairs in order before the Inland Revenue investigates them. The association has been informed that, in accordance with the Inland Revenue's 439W policy in all fields of investigation, a taxpayer who has been responsible for irregularities will not normally be at risk of prosecution for tax fraud provided he has taken steps to put his affairs in order before an investigation commences, and co-operates fully during an investigation.
This arrangement is not, as some press reports have suggested, an amnesty. It has been made clear to the London Dressmakers and Allied Contractors' Association that investigations into the tax affairs of member firms which are already under way, will continue.