On the face of it, the identification of four more avoidance schemes is good news - one less tax non-compliant umbrella company in existence the better. But dig deeper, and the fact that around 100 have been identified highlights the extent of the problem.
A failure to regulate the umbrella sector over the last decade, in combination with IR35 reform, has precipitated a huge increase in tax non-compliance.
The off-payroll rules have needlessly put some businesses off engaging genuine contractors, for fear of getting their IR35 status wrong. As a result, demand for umbrella companies has skyrocketed - and shifty operators have flooded the marketplace to meet it.
A serious change of strategy is desperately needed. The new government must follow up on the previous administration's shortcomings in regulating tax avoidance.
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