VAT cheats should be jailed
It’s been reported that Ian Liddell-Grainger MP has said that traders who charge VAT, and who are not registered with HMRC, and pocketing the tax should be jailed. Ian Liddell-Grainger, chairman of the All-Party Parliamentary Taxation Group said the scam is blatant fraud. Penalties for VAT fraud are currently very low usually no more than double the tax charged.
VAT numbers can be used for illegal purposes said HM Revenue & Customs (HMRC) and they are closely monitored. BBC Radio 4’s Money Box were told by Mr Liddell-Grainger, the Conservative MP for Bridgwater that it is well known that this fraud and extortion goes on but is hard to detect. With the rate now at 20% things could get worse, fraudsters can add 20% to a bill and pocket the extra cash. Registered businesses collect the tax and pay this to the HMRC on a regular basis. It was suggested that tax should be 10 times the fraud and a custodial sentence.
If you suspect fraud you can call the HMRC helpline – 0845 010 9000 – to check registration numbers. There is also an HMRC hotline to report fraud on 0800 595 000.