[Link]

Former public prosecutor says HSBC should face charges. Why I wonder doesn't Osbourn think the same?

Another act of hypocrisy (by probably everyone on here I'd wager) is to pay builders/plumbers/electricians/workmen cash, to get a job done cheaper and avoid paying VAT.

.. and how many people let out rooms and don't declare that income?

It all adds up and doesn't help our economy.

Actually small traders don't have to charge or declare VAT if their business earns under the the VAT threshold. So small time one man bands like window cleaners or odd job men for example won't charge it.

Paua oouaarancì Irà chiyeah Ishé galé ma ba oo ah

Okay... but paying them cash gives them the opportunity to not declare earnings and avoid income tax.

Tax dodging is costing governments – both in the UK and in developing countries – billions. This is money which is vital for tackling poverty. But despite the positive rhetoric from politicians, our polling shows that only one in five people believe political parties have gone far enough in their promises to tackle tax avoidance by large companies.

Nothing illegal or even immoral about paying someone cash. The only dodgy part is if you are doing it knowing they will not declare it (and it's highly unlikely you'd know). If you pay someone in cash and they don't inform the tax man, it's them breaking the law, not you.

Your example on the VAT front is a good one, though, if they are VAT registered and you collude in paying under the counter in return for a lower bill, you're aiding tax evasion. Personally I'd always be reluctant to do that on the grounds that bypassing the tax also involves bypassing a receipt, and leaves you scuppered should the job not be up to scratch