New criminal offences in crack down on tax evasion
Following on from the recent Budget announcement, tax evaders and professionals who enable tax evasion will face more severe consequences, including two criminal offences and higher penalties, under a new regime designed to come down hard on tax evaders.
In announcing the new measures, Chief Secretary to the Treasury, Danny Alexander, said, “’If people help a burglar, they are accomplices too. Now it will be the same for those that help tax evaders.”
A new and tough last chance disclosure facility will be introduced ahead of the worldwide automatic exchange of financial information coming into effect. New measures will:
- introduce a new strict liability criminal offence for offshore evasion – so in the worst cases it’s no longer possible to plead ignorance in an attempt to avoid criminal prosecution;
- make it a criminal offence for corporates to fail to prevent tax evasion or the facilitation of tax evasion on their watch;
- increase the financial penalties faced by evaders – including, for the first time, linking the penalty to value of the asset kept in an offshore bank account;
- introduce new civil penalties on those who enable evasion so they will face the same penalty as the tax evader; and
- publicly name and shame both evaders and those who enable evasion.
Mr Alexander said:
“I have made a great deal of progress in shutting down those loopholes and clamping down on aggressive avoidance and evasion. I have authorised over £1 billion of investment in HMRC to ensure they have the tools to do their job. There has been a quadrupling of criminal prosecutions, and a dramatic rise in taxes collected.
But now I am announcing that we are going even further. We’re making it a crime if companies fail to put in place measures to stop economic crime happening in their organisations. We’re also making sure that the penalties on those that facilitate evasion are large enough to punish and deter.
Tax evasion is a crime like any other. If people help a burglar, they are accomplices and criminals too. Now it will be the same for those that help tax evaders”
Over the course of the outgoing government, as a result of actions taken to tackle evasion, avoidance and non-compliance, HMRC will have secured £100 billion in additional revenue. This includes more than £31 billion from big businesses, and an extra £1.2 billion from the UK’s 6,000 richest people, who each have a net worth of £20 million or more.
I take it this does not apply to large corporations or banks who are accomplices to tax evaders. No? I didn’t think so.
I get disheartened by the government and the media are purposefully mixing the use of the words EVASION and AVOIDANCE in their speeches and interviews. These should be kept separate. What this serves to do is demonise anyone who is using legal methods, such as dividends and salary, or even ISA accounts, in order to minimise the tax they pay. I don’t know anyone who would stick their hand up and say “I wont use my ISA – I’ll buy shares in my personal trading account so that I pay full tax”, or, “I’m not going to get my contract reviewed for IR35 and just assume I am in because I am happy to pay more tax”. Technically most people in the UK could be considered a “tax avoider”. EVASION is the issue.
I agree with the above points.
Every time we agree to gift-aid we are encouraging tax AVOIDANCE by charities.
Pretty much everyone would avoid tax they do not need legally to pay. Tax **EVASION** is not paying tax that you ARE legally required to pay which is entirely different.
I would say almost all businesses do NOT have any problem with tax EVASION anyway.
As the OP said – it is a deliberate mixing of the terms.
Damn – I have just sent off my pensions contribution – tax avoidance at its most reprehensible.