§ Mr. Meadowcroftasked the Chancellor of the Exchequer if he will state the number of staff in the Treasury assigned to uncover tax evasion and related fraud, in each of the years 1979–80 to 1985–86.
§ Mr. Norman Lamont[pursuant to his reply, 19 June 1986, c. 633]: The number of Inland Revenue staff, measured in staff unit equivalents, assigned to investigation work in each of the years 1979–80 to 1985–86 is:
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Number 31 October 1980 1,659 1981 1,966 1982 2,166 1983 2,495 31 March 1984 2,843 1985 3,161 1986 3,237 The figures for 1983 and later years are not directly comparable with earlier years. Roughly one third of the apparent increase between 1982 and 1983 reflects a refinement of the calculations of staff effort devoted to investigative work in tax districts made possible by improved management information.
In Customs and Excise at 1 April 1986, the number of full-time specialist investigators and support staff engaged on tax and related fraud investigations was 454. Corresponding figures for preceding years could not be produced without disproportionate effort and cost.
There are, in addition, some 6,675 VAT control and Excise visiting staff whose work may from time to time include an element of fraud investigation.
§ Mr. Meadowcroftasked the Chancellor of the Exchequer (1) what was the estimated cost to the Exchequer of tax evasion and related fraud, in the years 1979–80 to 1985–86, in each tax bracket;
(2) if he will publish his assesment of the incidence of tax evasion as a proportion of total numbers of tax payers in the years 1979–81 to 1985–86.
§ Mr. Norman Lamont[pursuant to his reply, 19 June 1986, c. 633]: In relation to the direct taxes it is not possible to estimate the tax lost through undetected tax evasion and related fraud or to assess it as a proportion of the total number of taxpayers.
In respect of VAT I refer the hon. Member to the reply given by my hon. Friend the Member for City of London and Westminster, South (Mr. Brooke) to the hon. Member for Liverpool, West Derby (Mr. Wareing) on 11 April 1986, at columns 205–6.
The following table shows the number of VAT cases completed by prosecution or compounding in the years 1979–80 to 1985–86 and the number of VAT registered persons in each of those years:
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31 March Cases Persons (millions) 1980 474 1.33 1981 645 1.34 1982 601 1.38 1983 520 1.40 1984 568 1.43 1985 610 1.46 1986 630 1.48
§ Mr. Meadowcroftasked the Chancellor of the Exchequer what was the average sum involved in tax evasion cases in 1984–85; and in those cases investigated what was the average amount of money recovered.
§ Mr. Norman Lamont[pursuant to his reply, 19 June 1986, c. 633]: The average sums involved in tax evasion cases investigated by the Inland Revenue in 1984–85 were:
£ Tax offices 3,550 Inquiry branch 124,100 Special office 161,200 PAYE audit 3,100 It is not possible, except at disproportionate cost. to state how much of the amounts involved in those cases was ultimately recovered.
Proceedings in 610 value added tax offence cases were completed in the year ended 31 March 1985, with 165 cases having been prosecuted and 445 cases having been settled by compounding. Arrears of VAT totalled £23,349,124 for the 610 cases giving an average of £38,277 per case.
Statistics are not kept in such a way that figures can be given for the amount of these arrears that are collected, but it is estimated that, owing to the compounding of many of these proceedings, a substantial proportion will be recovered.
§ Mr. Meadowcroftasked the Chancellor of the Exchequer how many Inland Revenue staff are based in Leeds; and how many of these are assigned to detecting and investigating tax evasion and related fraud.
§ Mr. Norman Lamont[pursuant to his reply, 19 June 1986, c. 633]: There are 735 Inland Revenue staff in the Leeds area. Investigation of tax evasion is part of the normal duties of many of them, and is measured in staff unit equivalents. In the Leeds area it is 47 staff units.
§ Mr. Meadowcroftasked the Chancellor of the Exchequer how many cases of tax evasion in Leeds have been prosecuted over the past five years; and what was the average amount of money involved.
§ Mr. Norman Lamont[pursuant to his reply, 19 June 1986, c. 633]: In the past five years nine persons have been prosecuted in Leeds by the Inland Revenue. The average amount of tax involved was £10,829.
Leeds collection for Customs and Excise now covers a substantial part of the old East and West Riding. Records cover only the four years ended 31 March 1986, but during that period 60 VAT cases in that area were prosecuted, with an averge of £29,413 arrears of tax per case, and 186 VAT cases were settled by compounding, with a mean average of £11,759 per case.
§ Mr. Meadowcroftasked the Chancellor of the Exchequer if he will state the number of tax evasion and 320W related fraud cases resulting ill prosecution in 1984–85 and the number of prosecutions as a proportion of the total number of cases discovered.
§ Mr. Norman Lamont[pursuant to his reply, 19 June 1986, c. 633]: The Inland Revenue seeks civil money penalties for tax offences in all but a very small proportion of cases of evasion. Two hundred and thirty two prosecutions were completed in 1984–85.
In the year ended 31 March 1985, 797 cases were reported for VAT offences. In 83 cases during that year it was decided to take no offence action apart from collecting, any arrears of tax that may have been outstanding. There were 165 prosecutions during the year and 445 settlements by compounding.