Home Business Huzzah! HMRC Can't Find Any Tax Evaders!

Huzzah! HMRC Can’t Find Any Tax Evaders!

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There are times when it’s necessary to wonder at the logical dimness of certain people.

Let us construct an example. Say that we have laws against piracy in British waters. I think we still do. But we have a terrible lack of corpses being covered three times by the tide at Execution Dock. There are two possible answers to this. One is that we’re not prosecuting the piracy that is happening. The second is that there’s no piracy to prosecute.

Occam’s cutthroat tells us that the second is the more likely answer. We can also descend into mere empiricism and go attempt to find instances of piracy that are going unprosecuted. Given that there aren’t any – not unless we think those rubber dinghys crossing the Channel have been stolen at sea – then we can confirm that the absence of rotting cadavers upon seaswept gibbets is because of the absence of the crime, not some dereliction by the prosecuting authorities.

Good:

The tax authority has failed to prosecuted a single corporate tax evader and missed its targets to crack down on wealthy individuals in the past five years, in what has been called a “staggering failure” by experts.

In 2015, HM Revenue & Customs pledged to chase down wealthy individuals and increase the number of criminal prosecutions of wealthy individuals and companies to 100 a year by 2020.

However, according to a Freedom of Information request by law firm Kingsley Napley, there have been zero corporate prosecutions in the past five years. This is despite new Corporate Criminal Offence rules being introduced in September 2017, which were supposed to bolster HMRC’s powers.

Governments do not show a notable absence of lust for the pilf and gelt due to them. Occam’s shaving kit therefore leads us to the conclusion that HMRC is unable to find cases of corporate tax evasion to prosecute.

That is, the absence of prosecutions is because the crime isn’t being committed.

Oh, sure, there’s lots of tax evasion out there, all sorts of window cleaners are being paid in cash, do you a better price without VAT Guv’. There’s an awful lot of tax avoidance too, the attempt to reduce a tax bill through legal means. Something we find out whether it’s legal – and thus tax compliance – or tax evasion through examination.

But corporate tax evasion? The very fact that it’s not being prosecuted tells us that it’s not there in the sort of volume that requires prosecution.

Isn’t that nice?

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6 COMMENTS

  1. Wouldn’t Occam’s razor suggest it’s the fact that Inland Revenue (or whatever branding they go under now) are staffed with useless/lazy people (i.e. the civil service)?

    • Indeed. When it was still the Inland Revenue rather than the merged and disastrous Revenue and Customs we always used to tread lightly and treat returns conservatively (erring on the side of caution), because an Inspector of Revenue that had a sniff of tax evasion (or even “egregious” tax avoidance) was like a drop of blood in the water to a shark.

      However, since Dave Hartnett’s reforms and the merger with the heavy mob over at Customs, the Revenue has become a bastion of failure and incompetence that a barely trained teenager can run circles around and the threats are mostly toothless since all you need to do is illustrate the level of incompetence in the letters and other communications with respect to any questionable case and they back off. They no longer have the depth of knowledge and staff experience to actually handle a tax code as complicated as the UK’s with essentially a “customer service” approach more applicable to a mobile phone company.

  2. Either the following is a terribly shoddy description of what HMRC’s goal was or the goal was terribly wrong:

    “In 2015, HM Revenue & Customs pledged to chase down wealthy individuals and increase the number of criminal prosecutions of wealthy individuals and companies to 100 a year by 2020.”

    You don’t set a goal of X number of prosecutions. What if there are only X-10 guilty parties? Prosecute 10 innocent ones, we need to hit our goal!

  3. Candidly, Tim, you are wrong. I once bought something from a shop. Which most likely was operating as a company. I have no proof that my purchase was not entered in the company books but it is a possibility which I cannot rule out as I do not have, as I should have, the right to look at everyone’s tax returns. It is fair then to extrapolate this one event which took just a few seconds and imagine that it is happening every few seconds with every company in the UK. The amount of tax being deliberately defrauded is clearly at least £500bn every year. That every company is not being prosecuted by HMRC is clearly a neoliberal ploy.

  4. in what has been called a “staggering failure” by experts

    Who are these ‘experts’? Do they reside in an unappealing end-terrace in the unfashionable end of Ely?

  5. John Galt is correct, just correct. Indeed I have it on the most excellent authority, which I must not reveal, that any individual with an outstanding knowledge of tax isn’t valued for that knowledge. No, they’re immediately and reflexively met with suspicion for probably “not seeing the bigger picture”.

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expunct

in British English
expunct (ɪkˈspʌŋkt)
VERB (transitive)
1. to delete or erase; blot out; obliterate
2. to wipe out or destroy

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