HC Deb 22 February 1980 vol 979 cc637-9W
Mrs. Renée Short

asked the Chancellor of the Exchequer how many members of staff are currently employed in detecting tax fraud; and how this figure compares with each of the previous five years.

Mr. Peter Rees

[pursuant to his reply 26 February 1980]: The detection of tax evasion and tax fraud forms part of the normal duties of the majority of the staff of both Inland Revenue and Customs and Excise, but each Department does have specialised investigation units.

In the Inland Revenue the following table shows the numbers of staff in specialised investigation units at the dates given.

1 January 1975 205
1 January 1976 218
1 January 1977 261
1 January 1978 278
1 January 1979 281
1 January 1980 288

In Customs and Excise the following table shows the numbers of staff in specialised investigation units at the dates given. Such staff are engaged on cases involving not only evasion of duty or tax, but also breach of prohibitions such as importation of illicit drugs.

31 March 1975 510
31 March 1976 590
31 March 1977 610
31 March 1978 680
31 March 1979 700
1 February 1980 730

Mrs. Renée Short

asked the Chancellor of the Exchequer how much money was recovered by those working on tax fraud last year; and how this figure compares with the amounts recovered for each of the preceding five years.

Mr. Peter Rees

[pursuant to his reply 26 February 1980]: The Inland Revenue's figures for the yield from tax, interest and penalties arising from the detection of evasion are now calculaed to the end of October each year. The estimate for the year to 31 October 1979 is about £91 million. Figures for the previous five years are published in the annual reports of the board, of which the latest is for the year ended 31 March (Cmnd. 7822). These are:

£ million
Year ending 31 March 1974 16.1
Year ending 31 March 1975 17.3
Year ending 31 March 1976 23.2
Year ending 31 October 1976 23.2
Year ending 31 October 1977 48.5
Year ending 31 October 1978 70.5

Because of a change in the basis of the calculation, figures for the years prior to 31 October 1977 are not fully comparable.

Statistics of Customs and Excise offences are published in the annual reports of the commissioners, of which the latest is for the year ending 31 March 1979, (Cmnd. 7807). In the six years to that date, court fines, costs and settlements under section 288 of the Customs and Excise Act 1952 for offences in relation to Customs and Excise duties and VAT were as follows:

£'000
Year ending 31 March 1974 1,033
Year ending 31 March 1975 1,650
Year ending 31 March 1976 1,813
Year ending 31 March 1977 2,651
Year ending 31 March 1978 3,615
Year ending 31 March 1979 3,822

In addition, control visits to VAT traders are calculated to have recovered under-declared tax as follows:

£ million
Year ending 31 March 1974 not available
Year ending 31 March 1975 not available
Year ending 31 March 1976 not available
Year ending 31 March 1977 47
Year ending 31 March 1978 51
Year ending 31 March 1979 60

Neither the penalties nor the under-declarations can be attributed directly to fraudulent evasion as distinct from technical breaches of revenue law.

Mrs. Renée Short

asked the Chancellor of the Exchequer if he is satisfied that sufficient staff are employed to deal with tax fraud; what plans he has to increase the numbers of such staff; and what is his estimate of the amount of money that was lost last year as a result of tax fraud; and if he will make a statement.

Mr. Peter Rees

[pursuant to his reply, 26 February 1980]: I have no plans to increase the total staff of the two Revenue departments but I am satisfied that they will continue to deploy their available staff in the most effective manner. The very nature of tax evasion makes it impossible to place any reliable estimate on the amount of revenue lost.