A £4bn crackdown on aggressive tax avoidance schemes used by the country’s biggest companies was unveiled yesterday against a backdrop of growing international pressure on tax havens and corporate tax abuse.
From the Guardian:
A £4bn crackdown on aggressive tax avoidance schemes used by the country’s biggest companies was unveiled yesterday against a backdrop of growing international pressure on tax havens and corporate tax abuse.
To plug gaping holes in the public finances, Alistair Darling yesterday dramatically increased the power of Revenue & Customs inspectors to investigate corporate tax abuse and placed new duties on senior company executives to ensure large company tax returns are accurate.
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New “revenue protection” measures will raise £1bn and ensure a further £3bn that otherwise would be evaded or avoided finds its way to the exchequer, the chancellor said.
Key proposals unveiled yesterday are:
• Statutory requirements on senior accountants at major firms to certify personally that adequate controls to prepare accurate tax assessments are in place.
• New requirements on tax advisers to identify avoidance schemes.
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• A crackdown on banks that exploit foreign exchange loopholes to escape tax.
• New rules to deal with companies that exploit overseas tax rules that currently mean they receive double tax relief.
The chancellor also announced a new amnesty on the super-rich who keep their wealth in tax havens, under which tax evaders will not face prosecution if they agree to pay the back taxes they owe. Tax investigators have contacted major banks to force them to identify clients who may be breaking tax law, though it is unclear whether those banks are co-operating. Previous amnesties saw banks dragging their heels in supplying information.
Darling also announced plans to name and shame tax evaders and force those who have deliberately underestimated tax of at least £5,000 to provide more information on their tax affairs for up to five years. Tax inspectors will have new powers to monitor evaders.
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