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Brits busier than ever turning one another in to HMRC

Well it looks like you really can’t trust anyone: the taxman says that the number of people turning each other in for tax dodging is at an all time high.

The anonymous tip-off  hotline run by Her Majesty’s Revenue & Customs experienced a massive increase in the number of people using it in 2012, according to recently released figures. In fact, more than 72,000 anonymous tips were made over the course of the last year – that’s Brits making some 300 calls every day expressly to report tax avoidance or tax evasion.

This is an absolutely huge figure by any stretch of the imagination, though it doesn’t take into account how many people rang up to report the same instance of tax evasion in the event of a large multinational. However, it also doesn’t take into account how many emails or letters the HMRC received through the post reporting tax dodging tip-offs either, so the actual number of instances is really completely unknown – but it’s a safe bet that the figure is quite large if you ask me.

The taxman has kept tight-lipped as to whether these reports have led to full-fledged investigations of the individuals or companies that may or may not have been paying their fair share. On top of that, there’s nothing to say that Brits – already feeling quite put-upon by the poor economy – have become more than a bit bitter and vindictive, making them much more willing to ‘sell out’ their friends, neighbours, or employers (or clients in the event of a contractor) in order to eke out some measure of vengeance when they’re confronted with a ‘successful’ business that they suspect has only accomplished its growth through tax avoidance by dodging IR35 or using other legal loopholes.

But really how effective is an anonymous tip line in gathering information about who is and who isn’t engaging in tax avoidance? For what it’s worth, it seems like a completely inefficient method – and the National Audit Office agrees with me, as the NAO has in the past criticised the tip line for its low return on investment and constant under-performance; if you ask me it might me much more cost-effective to take the funds needed to run the tip line and put it towards something that will take a more direct approach to rooting out tax avoidance and tax evasion.

What could that possibly be? Well I’m not entirely sure, but I can say that it will probably work better than a tip line that is probably generating at least one false lead for every other true one!

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