HMRC boss Hartnett warns cash-in-hand payments 'diddle' the economy
People who receive cash-in-hand payments for goods and services are harming the economy, according to HM Revenue & Customs (HMRC) most senior taxman Dave Hartnett.
Speaking to the Daily Telegraph, he criticised tradesmen and other workers who try to get out of paying tax by asking for their payment in cash and said there will be a crackdown to catch individuals who do so from April 2012 onwards.
He said householders have a duty not to allow this to continue and encouraged them to use HMRC's whistleblowing service to report people they know are accepting cash-in-hand payments.
Mr Hartnett claimed evading VAT or income tax is 'diddling' the economy and will lead to further cuts for things like hospitals and schools.
"Tax provides the funding to run the country: hospitals, schools and everything else. Every time someone pays cash in order not to pay VAT, the nation gets diddled," he remarked.
The crackdown is one of a series recently operated by HMRC, with others having investigated and prosecuted eBay traders, plumbers and home tutors.
Mr Hartnett also took the opportunity to insist that no so-called sweetheart deals took place last year to allow big firms like Goldman Sachs and Vodafone to get out of paying tax bills.
Earlier this week, HMRC said it may have to waive some penalties for people who do not file their self assessment tax returns online after staff announced a walkout on deadline day.
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