Treasury could raise £1.45bn to reduce fuel duty by tackling tax evasion by unregulated hand car washes

“The Chancellor would have been able cut fuel duty if all the tax owed by the hand car wash sector had been paid”, said Brian Madderson, Chairman of the Petrol Retailers Association (PRA) commenting on the Prime Minister’s announcement that fuel duty will be frozen in this month’s Budget.

Madderson who is also Chairman of the Car Wash Association (CWA) adds, “The hand car wash sector should be paying up to £1.45 billion per year in tax, and this is not being collected by HMRC. 

“That money could be spent on the NHS or on cutting fuel duty next year. It would have been impossible to justify fuel duty increases on motorists, given HMRC is ignoring over a billion pounds worth of uncollected tax from hand car washes”.

The CWA has been meeting with Government officials over the last few months to review the problems caused by unregulated hand car washes across the UK.
These problems encompass tax evasion, environmental issues from mishandling trade effluent and employment irregularities such as human trafficking, modern slavery and widespread disregard of the National Minimum Wage regulations.

All these points have been made to the formal Inquiry being conducted by the Parliamentary Environmental Audit Committee, where Mr Madderson gave evidence as an expert witness, and at meetings with the Cabinet Office, HM Revenue & Customs, Office for Labour Market Enforcement and others.

A main thrust of these presentations was that the National Police Lead for Human Trafficking had estimated up to 20,000 unregulated hand car washes were operating across the UK. Based on this estimate and using reliable revenue projections, it was possible that up to £1.45 billion extra tax could be collected per annum.