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Responses to consultation on tackling the hidden economy through sanctions and ‘conditionality’

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Following consultation between August and October 2016, the government announced at Spring Budget 2017 its intention to take further action to tackle the hidden economy. It will:

  • develop further proposals on ‘conditionality’, the principle of making access to certain licences or services conditional on tax registration, and explore options to trial conditionality through pilot activity;
  • consider the design of a stronger ‘failure to notify’ hidden economy penalty which may take account of past behaviour, delivered as part of the longer-term HMRC penalties review; and
  • strengthen HMRC’s monitoring of taxpayers found to be operating in the hidden economy.