Why spend so much on benefit fraud when tax is the issue?

Posted on January 23 2008

The National Audit Office (NAO) has found the Department for Work and Pension (DWP) spent £154m in 2006-07 to identify an estimated £106m of fraudulent claims after examining six of the most important counter-fraud activities for their cost effectiveness.

NAO found the department had cut estimated benefit fraud from £2bn to £800m a year since 2000, but said DWP 'could do more' to be cost-effective.

The whole of HM Revenue & Customs' tax collection activity cost £5 billion to run in 2006-07 (page 32). It collected £423 billion.

We know there is a substantial tax gap though (and I will publish more on this soon - but take this for starters). So where would the £106 million of resource have been better spent? On benefit fraud or tax collection? And since it was obviously the latter, why is it HM Revenue & Customs that is having the staff cuts?

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One Response

Tax dodging is the problem « Rebellion Sucks! = a blog for socialism & self-determination says:

January 23 2008 at 11:48 pm

[…] dodging is the problem Wednesday, January 23, 2008 — charliemarks My good (tax) man Richard Murphy points out the following […]