UK unveils new measures to combat tax evasion

19th March 2015, Comments 0 comments

Corporations linked to offshore tax evasion by investors in Britain will face criminal sanctions under government plans unveiled Thursday, a month after an international scandal over tax-dodging by HSBC clients in Switzerland.

"We inherited a tax system with more holes in it than a Swiss cheese," Chief Secretary to the Treasury Danny Alexander said, unveiling a raft of measures including higher penalties for tax evaders.

The new measures will allow for prosecution of tax evasion without having to prove intent, while tax evaders and companies which help them will be "publicly named and shamed", the Treasury said.

The announcement comes a day after finance minister George Osborne unveiled Britain's final budget before the country's May general election.

"We're making it a crime if companies fail to put in place measures to stop economic crime happening in their organisations," Alexander said.

"We're also making sure that the penalties on those that facilitate evasion are large enough to punish and deter."

Financial penalties will also be increased and linked to the value of assets kept in offshore accounts.

Just over a month ago, "Swiss Leaks" investigations by international newspapers claimed HSBC helped clients from around the world dodge taxes on accounts containing 180 billion euros (£130 billion, $204 billion) between November 2006 and March 2007.

HSBC chief executive Stuart Gulliver last month apologised to a committee of British lawmakers for "unacceptable" failings over the allegations.

Britain's tax office has already secured £100 billion in additional revenue as part of a crackdown on tax evasion over the last four years.

The government hopes to raise a total of £3.1 billion by 2020 through its new tax enforcement, including £560 million from an offshore tax evasion campaign, aided by an international agreement between 90 countries on the automatic exchange of tax data.

G20 finance ministers have endorsed the data-exchange model, spearheaded by the Organisation for Economic Cooperation and Development (OECD), as the most effective means of fighting tax evasion.


© 2015 AFP

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