Great headline, I think. It’s in the Mirror this morning. The story says:
George Osborne is exposed as a hypocrite for talking tough over a VAT dodge in opposition - but not acting to end it now he is Chancellor.
Three years ago he wrote to Richard Allen that he would "hold the Government to account" for letting large firms route imports of items such as CDs via the Channel Islands to avoid VAT.
Mr Allen, 47, of Chalfont St Peter, Bucks, said he had to close his mail order business as giant retailers were able to undercut him on the VAT.
Although the scam costs £200million a year in lost tax, after two months in office Mr Osborne changed his tune.
In another letter, he said the dodge - known as the low value consignment relief - ''was introduced in the UK many years ago to simplify import procedures".
The Chancellor's inaction is revealed as the ConDems unveil plans to spend £900million to target tax dodge loopholes.
Precisely.
And so nice to see the Mirror uses the ConDem terminology.
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Perhaps time for someone to see if there’s any overlap between Osborne/Tory party funders or lobbying contacts since the election, and those who benefit from the loophole…
Hmmm. So what was Labour’s excuse for the past 13 years?
Here are some interesting figures that just emerged. In 2005 UK admitted loss of VAT from Channel Islands was £40m. Jersey paid £8m in VAT (for items collected over the £18 threshold) and £7.5m of that came from Play.com, proving Play.com as the main source of sales. That means £32m in loss VAT overall. For what ? The industry currently only employs 2000 people in Jersey. In 2005 the UK could have paid them all £16,000 each to sit on their backsides and do nothing, for the same money. The more I look at this the more I think its smart business running rings around idiots.
@ Richard Allen
Doesn’t even seem like they have to be too smart does it? Good luck with your court case on this matter.
Best of luck Richard but I suspect that your five year campaign might have to continue for some time. I was talking to an inspector from HMRC not too long ago on this very topic and it appears that they have little interest in doing something about this. The comment I had was along the lines of “it will cost too much in manpower and resources to deal with and there are bigger and better things to go after”.
Woolley, I take your point. If memory serves there was never a Labour commitment to address this; I don’t know if that’s worse or better! But you have to wonder what might have brought on Osborne’s change of heart; it’s not as if the revenue/jobs wouldn’t be welcome…
Which is potentially what the UK Gov. will do if these 2,000 people lose their jobs. Expect them to join the UK benefits system, because for most, that will be their only option.
@Dan
I suspect many are Portuguese
Many are Portuguese. As Dan says, expect them to join the UK benefits system. No matter, this trade should still be stopped.
@JohnBuckles Well this will be a real test of the EU then. If VAT is that easy to ignore bring on anarchy I say. At least Tax inspectors won’t survive that
@Dan Good. At least I and many others who have been affected by this won’t be paying for it out of our business.