Speeches by Hatton.

“But you do think that it happens.”

“It does happen. Because you take so long to investigate, people can get out of the country.”

“Do you not worry, then, that, if it takes 40 months on average to complete an investigation, there is a serious risk associated with flight? These people just get out of the country, and it is then impossible for HMRC or, indeed, any other body or agency to track them down.”

“The process of investigating has grown in how long it takes, from 27 months to 40 months. You have both said that these take months and months, and that it is a lengthy process of back and forth.”

“Are some of the individuals being deliberately obstructive, where it is not about appeals or using the proper processes that are available to them? Are some of these individuals under investigation deliberately slowing down the process?”

“There is a long way to go.”

“It is from quite a low starting point, granted.”

“What is perhaps quite worrying, looking at this NAO Report and other reports, is that the yield is very low. Could we get some clear reasons for why 46% of investigations still close with no yield at all?”

“It helps a little bit. It would be useful just to move on, if we could—and we are probably going to touch on this at some point later in the session anyway—to look at compliance in a bit more detail.”

“Around this idea of your estimate of the wealthy tax gap, it does seem that it is not clear. I felt, reading the NAO Report, that it was not clear, so I hope that you can provide some clarity today. The wealthy tax gap has remained under £2 billion for a while now, but the number of wealthy individuals has grown quite …”

“Would it include dividends?”

“It might be helpful if you could provide a bit of detail about how HMRC has reached the £1.9 billion figure for the tax gap for the very wealthiest. Does it simply include routine non-compliance, or does it cover deliberate and aggressive tax avoidance? Is it based only on savings and income, or does it include other t…”

“What does it exclude, then?”

“Are you able to reassure us about how we can see it scaled up and used more frequently? This was only the first time that HMRC had ever used it.”

“Just touching on those who promote offshore tax avoidance schemes, there was a landmark action last month, which I certainly welcome, and you issued stop notices to Paul Baxendale-Walker for covering two offshore arrangements. That action that you took in that particular case was the first time that such action had bee…”

“Yes, that would be really helpful.”

“That is about evasion, so that is about criminal behaviour, not aggressive tax avoidance. You can understand why I and, I am sure, other members of this Committee would want to see those powers used by HMRC.”

“Has it never been the lead risk? Will there be no instances when this power could be used?”

“You do not use this one. That is one at your disposal, and you should be able to outline to this Committee why there have been no penalties levied on tax experts, tax advisers or lawyers, or whatever you want to call them.”

“If the one that I just mentioned was used effectively, the penalty at the end of it could include either a £3,000 fine or 100% of the amount of tax that was dodged, whichever is larger. I imagine that it is normally going to be the latter; that is probably a lot bigger figure than £3,000. That is a tool that you have. …”