§ Mr. Eggarasked the Chancellor of the Exchequer what is the estimated loss of value added tax and income tax and so on from tax avoidance or evasion by traders in the construction industry who are failing to register for value added tax; and if he is satisfied with the present arrangements for enforcing the relevant legislation.
§ Mr. HayhoeI regret that it is not possible to provide a meaningful estimate. The present VAT enforcement arrangements, while protecting established businesses from undue interference in their activities, do not necessarily ensure that new and growing businesses make timely notification of their liability to be registered. This should be improved with the new civil penalties proposed in clause 14 of the Finance Bill.
To combat evasion of direct taxes, the Inland Revenue has been allocated additional staff. On present plans, the number of staff deployed to combat the black economy will have been increased by 1,700 over the period 1979 to 1988.