As we all know, our favourite retired accountant tells us that there\’s a huge amount of tax being left unpaid. One of the numbers he uses to get to his sky high estimate is tax debts….taxes which everyone agrees are owed but which never quite manage to get into the Treasury\’s coffers.
First Quench Retailing, owner of the Threshers off licence chain, crashed into administration last autumn owing HM Revenue & Customs £24.7m in unpaid VAT, excise duty and National Insurance arrears, new documents reveal.
That\’s where some of it is and it\’s very difficult indeed to see how it could be any other way.
If we\’re going to have a system in which bankruptcy is an option, in which bad businesses get swept up and the assets redistributed to those who can make better use of them (and this is absolutely vital to an efficient economy, that this happens), then we\’re always going to have instances where tax goes unpaid.
Which means that we really cannot just run around shouting that if only we collected all our tax debts then there wouldn\’t be any deficit. Because there are always going to be instances when there is indeed a tax debt but simply no money to pay the tax debt.
I can\’t remember whether HMRC is still a preferred creditor or not: doesn\’t matter, for there will still always be instances where this happens, given that tax is paid in arrears.
Oh, and as to the mooted new law about not selling alcohol below cost:
As soon as First Quench collapsed a fire sale of assets – and stock – began. Thousands of customers flocked to its stores to pick up cut-price bottles of wine and spirits.
How\’re you going to deal with that laddies?