Taylor review looks to end cash-in-hand tax avoidance worth £4.4bn

Informal cash-in-hand work could soon be accountable to HMRC, as the government-commissioned Taylor review recommends full taxation of revenue in the so-called “hidden economy”, with a line of potential workplace benefits going the other way.

As part of seven recommendations handed to government to resolve the challenges of today’s self-employment landscape, the report’s author, Royal Society of the Arts chief Matthew Taylor, told BBC Radio 4’s Today show that a “more level way of taxing labour” would close a public finance black hole from lost tax revenue.

Taylor cited typically cash-in-hand jobs, such as window cleaning and decorating, as worth as much as £6bn a year, representing a significant revenue boost to public finances if taxed properly.

As part of the trade-off, cash-in-hand self-employed workers would be brought into a framework that reflected traditional employment. Better protections would include pension entitlement and sickness insurance.

In March, Taylor told Business Advice that government could as an “enabler” to open such services for the self-employed.

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