Taxman grills London’s fast food VAT dodgers

The taxman has launched a new taskforce to tackle what they call “VAT abuse” in London’s fast food outlets. HM Revenue & Customs thinks it has identified a widespread problem: with some fast food outlets deliberately falsifying their records and mis-declaring their true sales levels – in order to avoid paying the correct taxes: mainly VAT.

Rather than carry out tax enquiries through the normal Local Compliance network the taxman is planning a quick smash and grab raid.

The taxman says: “This taskforce will come down hard on fast food outlets that have chosen to break the rules and evade the taxes they should be paying.  If you deliberately seek to evade tax HMRC can and will track you down, and you’ll face not only a heavy fine, but possibly a criminal prosecution as well.”

Taskforces bring together various HMRC compliance and enforcement teams for intensive bursts of activity targeted at specific sectors and locations where there is evidence of high risk of tax evasion. The first taskforces were launched targeted the restaurant trade on 12 May 2011.  They target the highest-risk cases in a business sector and location, typically focusing on groups of around 600 businesses in specific locations. The fast food task force is the 4th taskforce so far.  The taxman is planning nine more in 2011/12, with yet more in 2012/13.  The taskforces come as a result of the Government’s £900m extra investment to tackle tax evasion, avoidance and fraud from 2011/12, which aims to raise an additional £7bn each year by 2014/15.

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