Customs and Excise's Bill O'Leary: "The taxpayer and the honest businessman benefit"

Seventy officers took part in Operation Harvest, which targeted restaurants and fast food establishments in Leicester, Coventry, Worcester, Northamptonshire, Wolverhampton and Birmingham.

HM Customs and Excise spokesman Bill O'Leary said the operation had been "very successful" in uncovering evidence of VAT evasion and several instances of benefit fraud.

The BBC's Carey Johnston: "Customs officials scrutinized traders' records"

For several months before the raids, customs officers joined officials from the Benefits and Contributions Agencies in monitoring food outlets suspected of failing to pay or not paying enough VAT.

Late on Friday evening, teams consisting of all three organisations visited more than 80 establishments and examined the owners' sales records and conducted on-the-spot interviews with staff.

Tax arrears worth millions of pounds were uncovered and will now have to be paid.

Mr O'Leary said that cash-based industries like hot food, hairdressing and construction were "rife areas for tax evasion".

"But the rules are fairly straight forward," he said.

"If turnover exceeds £50,000 per annum - about £1,000 per week - then you need to be registered for VAT."

He said that all the food outlets raided had failed to return tax questionnaires or had returned incomplete forms.

Cannabis charges

In an unrelated operation on Friday, Wiltshire Police said drugs worth £1m were netted during raids at 15 addresses in the Swindon area and one at a business park in Oldbury, West Midlands.

Eight people, ranging in age from 20s to 40s and including one woman, were arrested.