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LibDem conference: Additional 2250 inspectors to fight tax evasion

A team of 2250 tax inspectors is being recruited to crackdown on tax avoidance among 350,000 of the country’s wealthiest people, according to Treasury chief secretary Danny Alexander.

In his speech to the Liberal Democrat Conference today, Alexander also confirmed the LibDem’s “aspiration” to raise the income tax threshold to £12,500, after achieving the coalition agreement’s goal of increasing it to £10,000. The income tax threshold is currently £7,475, rising to £8,105 from April 2012.

Alexander told delegates: “My message to the small minority who don’t pay what they owe is simple, I agree with the Chancellor. We will find you and your money and you will pay your fair share.”

“We need to make sure tax owed is tax paid. Last year, I announced a package of investment to strengthen our fight against tax evasion, as well as tax avoidance. Let me tell you how we’re getting on. This year, an additional 2,250 HM Revenue and Customs staff will move into new anti-evasion and avoidance jobs. This month, over 1,000 of these jobs are being advertised.”

Alexander told the Independent on Sunday the “affluence team” will target those worth more than £2.5m with a particular focus on those in the 50p tax bracket.

He said: “We are keeping up the pressure on tax evasion and tax avoidance, on making sure those with the broadest shoulders bear their fair share of the burden.”

With a view to cutting the 50p rate completely or reducing it, Chancellor George Osborne has asked HMRC to review how much revenue it raises for the Government. Treasury estimates put that figure at £2.7bn, 70 per cent of which would remain if the rate was cut to 45p. Last week, the Institute for Fiscal Studies’ Mirrlees Review of the tax system said it actually cost the Treasury £500m a year in lost revenue.

In August, Alexander said those looking for the rate to be cut were living in “cloud cuckoo land” and on Saturday, Deputy Prime Minister Nick Clegg told the Independent there is “no way” his party would allow the 50p rate to be cut “unilaterally” without the tax burden on low and middle incomes being lowered and moves being made to increase tax take from higher earners.

He said: “We are not there to rush to the aid of the top 1 per cent of very, very rich people who are not in straitened circumstances.”

Alexander told conference the coalition agreement’s commitment to raising the income tax threshold to £10,000 is the Government‘s “first tax priority“, but added that in the next parliament, it will be Lib Dem policy to raise it to £12,500.

He said: “Our aspiration should be that someone working full time on the minimum wage should pay no income tax at all. An income tax threshold of £12,500 – think what that would do to work incentives, think what it would mean for basic fairness.”

The money for the new tax inspector team comes from the £900m Alexander told last year’s conference would go towards a crackdown he expected to deliver an extra £7bn to Government coffers. One year on, he told delegates HMRC is on track to raise almost £2bn of extra revenue this year as a result of the package.


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There are 4 comments at the moment, we would love to hear your opinion too.

  1. With more and more people out of the scope of Income Tax will there be fewer people who actually care how much the government spends.

    After all if you have no skin on the table why worry – spending will never cost you anything. If I wasn’t paying any tax I would campaign for government spending everywhere I could – after all a free lunch is worth having!!

  2. A bit rich coming from the same man who used a legal loophole to avoid paying capital gains tax, by describing his main residence as his second home.
    A classic case of “Do as we say…

  3. Headlines and propaganda. 2250 New tax inspectors? When i worked for them, it took ages to train a tax inspector.
    That gives the tax evaders plenty of time to continue.
    Why not ban accountancy and legal charges which can be offest against business or investment tax.

  4. Eleven months ago HMRC announced 13,000 HMRC staff would go – so the 2250 “extra” has to be seen in the context of a Danny Alexander news management ploy .

    “Tax collectors were today told (20th Oct 2010) that 13,000 of the 69,000 posts at Revenue and Customs will disappear by 2014-15, “

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