The annual cost to the industry of administering CIS used to be higher, as revealed in the 2006 KPMG report, but is now around £250m as calculated in Appendix 1. There is no other industry-specific scheme that comes even close to this level of cost.
Penalty farming is an accusation regularly levelled at HMRC, and though those levied through CIS have been tempered and capped, this can still mean thousands payable by businesses for late compliance.
There is also the cost to the industry of the denial of reg. 9, where tax is paid on occasion by both contractor and subcontractor.