Consultation outcome

Penalty for participating in VAT fraud

This consultation has concluded

Download the full outcome

A penalty for participating in VAT fraud - summary of responses

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Detail of outcome

Having carefully considered the responses to this consultation, the government has decided to proceed with the introduction of a penalty for participating in VAT fraud. It considers that there is a strong case for having a new penalty aligned with the knowledge principle. This will help streamline cases and strengthen HMRC’s ability to tackle serious VAT fraud. The government also recognises the deterrent benefits of a strengthened penalty regime in this area.

We are grateful to everyone who took the time to respond to the consultation exercise. We received 130 responses from a wide variety of stakeholders across different sectors. We were pleased to see responses from small and large businesses, tax representatives and trade associations. The responses have been invaluable in understanding respondents’ views and concerns.

Original consultation

Summary

A consultation on whether to introduce a new penalty for participating in VAT fraud.

This consultation ran from
to

Consultation description

This consultation, announced at Budget 2016, seeks your views on the introduction of a new penalty for businesses that participate in VAT fraud.

This consultation considers a range of options for a new penalty for those that knew or should have known their transactions were connected with VAT fraud. The consultation explores the case for a new penalty, including the following questions:

  • how should the penalty be structured?
  • should the new penalty apply to company officers?
  • should the new penalty feature reductions in the level of the penalty for co-operating with HMRC?
  • should those that participate in VAT fraud be named and shamed?

Responses to the consultation will be summarised and published later in the year. The results of the consultation will be considered and the government will then take a decision on whether to introduce a new penalty.

Documents

Penalty for participating in VAT fraud

This file may not be suitable for users of assistive technology. Request an accessible format.

If you use assistive technology (such as a screen reader) and need a version of this document in a more accessible format, please email different.format@hmrc.gsi.gov.uk. Please tell us what format you need. It will help us if you say what assistive technology you use.

Published 28 September 2016
Last updated 5 December 2016 + show all updates
  1. Published summary of responses.
  2. First published.