HMRC Is Shite

HMRC Is Shite
Dedicated to the taxpayers of Britain, and the employees of Her Majesty's Revenue and Customs (HMRC), who have to endure the monumental shambles that is HMRC.

Friday, 8 July 2011

Go East

I see that Dave Hartnett of HMRC is enamoured of China, specifically the Chinese method of taxing small businesses.

The Telegraph reports that Hartnett has told David Gauke, the Exchequer Secretary to the Treasury, and the independent Office for Tax Simplification (OTS) that China's new "turnover tax" has "appeared to have a very positive effect on tax compliance".

Gauke (a lawyer with little financial expertise) has now asked the OTS to examine new ways of taxing Britain's 1.8m sole trading businesses that are earning less than £20K per annum.

It seems that Hartnett is of the view that small firms are responsible for a "sizeable element" of the UK's "tax gap". I wonder if he would care to provide figures to back that claim up?

Tax does have to be taxing.

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  1. Hartnett must have got fed up being made to look stupid by the big guys. What makes him think blaming the little guys will result in anything different.

  2. Nothing new here really. If you cannot screw more tax out of the big boys (too difficult) let's go for soft targets, small businesses. Take off the personal allowance of 7.5k, and what are you left with? 12.5k at best. Many will have profits under 7.5k. It just smacks of the usual HMRC prejudice that all small businesses are on the fiddle.

  3. What happens to them in China, if they are caught being non compliant!?

  4. They are shot and their organs immediately removed in one of those horrendus medical buses before the organs are sold to wealthy arabs and westerners.
    The bodies are ground up and added to the rest of the crap they put into the counterfeit fags they export.
    Oh, yes, and the whiteboards reflect the statistics, fiscal crime reduced and fiscal criminals reduced in numbers, celebrate success, Banzai! Ooops, thats the other lot isn't it.
    Ah well, Duke of Edinburghs Rules apply, tee hee.

  5. Any truth in the rumour that China is buying the News of The World brand?
    Someone said they want it for its brilliant research methodology and customer-centric service.
    I believe the whole story is a conspiracy fabricated by the ConLibs.
    Whoa, just a mo' who's been nicked now, flippin' 'eck that was bad judgement on someones part giving him a job and clearance?!
    Can't wait to see the final issue on Sunday, wonder if the front page has been agreed yet.

  6. @Anon 10.15. Don't forget once they are registered they can claim back all the VAT they already pay to their suppliers (which at the moment they can't) and if they supply to other businesses that are VAT registered those businesses will reduce their VAT payments by the amount these businesses charge.

    Its only the "value added" that will be an increase in collections so that £20k turnover could soon reduce to about £5k-£7k Vatable income.. so about £1k collectable in VAT.

    (Figures pulled from my head but the principle is sound if the figures slightly exaggerated).

  7. That presupposes they are over the threshold for VAT surely?
    Bearing in mind that many businesses have gone through, the pool reduces as time progresses.
    Good point though.
    BTW has Hartnett tired of curry and prefers a Chinese instead?
    Trouble is, 20 mins later you want another one.
    Order no. 73, you get a covered dish that moves and goes qwack and you see 2 eyes staring back at you when you look under the lid! You ask the waiter "WTF is this?" And he say "You order Peeking Duck, now fluck off!"
    LOL :D

  8. China eh?
    What next, sdvice from Mexican drug barons about how to enforce and collect debt?
    Better hurry up locating call centres in India some of the biggies are drifting back.
    RIPA applications by Sunday tabloid.
    Business ethics by Rupert.
    Accountability by Teflon.

  9. Everyone miss the report HMRC published 7/7?
    2 quick quotes:-
    Compliance - 52% pay the tax due (or 48% don't)
    Engagement/Customer-centric satisfaction with "service" in relation to contact, well, during 09-10 75.8% were answered, during 10-11 this plummetted to 48%!
    And have a look at the excuses given for an employee engagement score of 34% (103rd?) in section 5.17.
    Its all there, publicly reported have a l@@k for yourselves.

  10. I really hope they don't introduce a turnover tax here as it would hurt a lot of small businesses and businesses that deal in expensive products but don't necessarily get a huge return for selling them on. They do not deserve to be punished for the 'clever' antics of the very big businesses who exploit middle-finger-erecting loopholes in the law.

    With that in mind, I hope that if Dave Hairnett somehow convinced the current government to introduce this stupid way of taxing businesses, they make the threshold of people who would be affected somewhere near £100,000,000 so that it only really affects those who are desperately trying to exempt their huge dodgy accumulated personal wealth from various taxes some other way.

  11. Surely a turnover tax would cause more people to cross the line from avoidance to evasion.
    The tax gap would increase with the expected tax take lessening.
    Others would just give up as this could be the final straw for many, would this include those few SME dairy farmers left in business?
    Hardly the desired very positive effect on tax compliance.
    Or is the answer in the projected figures, lies, damned lies and statistics?

  12. I see that this proposal has been taken up by John Whiting. Who's he Ken?

  13. Somewhere along the line the balance will inevitably tip and the little peeples will have their day.
    I don't believe for one minute it will be an anarchist revolution but I do believe that hmrc will be forced to toe the line, particularly where adherence to the law is required.
    The public is only capable of being pushed so far as recent events have shown and a taxation system that is continuously shown to be breaking the law will fail.
    What will it take, not much more now, perhaps just one more bombshell, who knows?
    It is still conceivable that the top is so remote from the workface that "fiefdoms" have been operating at will, that appears to be changing, slowly but surely and we may yet see a common sense approach prevailing, don't care what the motivation is as long as it happens.
    The staff and the public deserve better and the time of the spin/political claptrap spouter is past, if it isn't working, admit it, change it and ditch the rubbish on the way. The whole mess has been allowed to continue for way too long, step forward a Politician with integrity, you know it makes sense!

  14. @15:44

    A politician, with integrity?!

    I thought they were all extinct?

  15. Was there not a Conservative MP recently who defied the whip and the PM regarding voting to support the introduction odf a bill outlawing abuse of circus animals or similar?
    I would suggest that is not only integrity but balls!

  16. @21:54 Agreed!

    Its a shame they don't all appear to have the same "moral compass" !!