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New criminal offences in clampdown on tax evasion

'If people help a burglar, they are accomplices too. Now it will be the same for those that help tax evaders’, explains the Chief Secretary.

Tax evaders and the professionals who enable tax evasion will face tough new sanctions, including two new criminal offences and higher penalties, under a new regime to crack down on offshore evaders the Chief Secretary to the Treasury Danny Alexander announced yesterday (Thursday 19 March).

Building on the recent Budget announcement that the government is introducing a new and tough last chance disclosure facility ahead of the worldwide automatic exchange of financial information coming into effect which the UK championed, the Chief Secretary is today unveiling plans to:

  • 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
  • publicly name and shame both evaders and those who enable evasion

Chief Secretary to the Treasury Danny 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’.

As well as action to crack down on offshore tax evaders through a tough new disclosure scheme, the Budget included new penalties and reporting requirements to tackle persistent tax avoiders.

The Chief Secretary has also yesterday called on the tax and accountancy professional regulatory bodies who police professional standards to maximise their role in setting and enforcing clear standards around enabling and promoting avoidance.

The details on the new evasion regime and avoidance sanctions are outlined in a report published yesterday which sets out the government’s approach to tax avoidance and tax evasion.

The government will consult on the detail of the new evasion regime.

Over the course of this Parliament, 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.


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