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Workers and tradesmen who receive cash in hand payments are damaging the UK economy, according to Dave Hartnett, HM Revenue & Customs boss. In an interview with the Daily Telegraph, Mr Hartnett stated that, from April 2012, there will be a crackdown on individuals and businesses asking for payments in cash to avoid payment of tax.

Following on from his statement, Hartnett advised householders to make use of the whistleblowing service launched by HMRC to inform tax inspectors of anyone they know who is accepting cash in hand. He said that anyone who takes part in tax evasion is “diddling” the UK economy, which will result in further cuts on services being made. He said:

“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.”

The crackdown, which is planned in April this year, follows on the success of other campaigns which have targeted plumbers, online and car boot sale traders and tutors. In February 2012 a further campaign to target electricians will be launched. HMRC defines an electrician to be anyone who maintains, installs and tests electrical systems, appliances and equipment under strict regulations. HMRC will offer fixed penalty charges to any electrician who comes forward to declare unpaid tax.

During the interview with the Daily Telegraph, Hartnett also pointed out that deals had not been negotiated with large companies like Vodafone or Goldman Sachs to avoid payment of tax.

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