The tax institues – making all the wrong choices on the ‘tax amnesty’

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I've already blogged about my profound disappointment with the response offered by the combined professional tax institutes to HMRC's offshore tax disclosure scheme.

It seems to me that this might be a seminal moment for these institues in the UK for two reasons. First their credibility depends upon the confidence their members have in them. Second, their influence depends upon the credibility of the role they play in society.

Judging by the pathetic advice they have issued so far on this matter I can see no reasons why a) their members should have any confidence in them b) those members should have any hope of getting useful advice from their Institutes on this issue c) those members should believe they are getting anything like value for money in exchange for their membership at a time when pressure on those members will be high. Unless they act very fast to get their act together (and I'm not an optimist on this) then the Institutes are in deep trouble.

Even more important though is the choice that the professions seem to be making in their response to the HMRC initiative. The philosophical choice it seems they were presented with was a) support the HMRC approach and do all they can to make sure it works with the support of their members, or b) assume it was their primary job to defend those who have evaded tax and now face penalty for doing so. It's abundantly clear from all that has been written by the professional bodies that they chose option (b).

This is dereliction of duty on their part. I am simply amazed that the three issues they could raise for the benefit of the press on this matter are:

- The tight timescale being imposed for disclosures under the initiative.

- That they think HMRC have chosen to launch the initiative with minimal publicity and that this means that the burden of promoting this HMRC initiative is instead being placed on the banks and tax advisers.

- Practical differences between the offshore initiative and the parallel onshore initiative.

The first is an effective suggestion that professional people won't be able to cope with this matter. This second is a straightforward whinge which is firstly untrue, and secondly where as a matter of fact the professions do have a duty to publicise the issue, not least because they'll already be representing a lot of those who now need to make declaration. The last claim is a sure sign that technicians want to stick their heads in the sand.

What they should have said (but emphatically did not - going out of their way not to endorse this whole arrangement) is that:

  1. This is a welcome opportunity;
  2. They will be encouraging all their members to join with them in publicising this initiative;
  3. Professional tax advisers are available to help anyone requiring advice on this issue;
  4. They will be encouraging all represented taxpayers in the UK to make full disclsoure if they have not already done so;
  5. Best endeavours will be used to ensure that help can be provided to anyone who has not already got an adviser.

But this opportunity to support members, and to show proper commitment to lawful payment of tax has been foregone.

What's the message that's been put out instead? That the tax profession are a bunch of moaners who side with those who have not paid the tax due by them. That's the message I get. This was a philosophical choice. It was the wrong choice. The tax authorities, tax practitioners and the public of this country will observe that choice. All will, if for differing reasons condemn it. And that's right and proper, and all that is deserved.

What's abundantly clear as a result is that the tax profession in the UK needs new leadership - leadership that believes in tax compliance, helping tax professionals and helping the public. It doesn't seem much to ask, but we certainly haven't got it.