I have just seen an email from a Lib Dem prospective parliamentary candidate that feels as if it has official sanction. It says:
Liberal Democrats are determined not to let up in the fight against tax cheats. If we are in Government again we would seek to introduce a General Anti-Avoidance Rule, which goes much further than the current anti-abuse rule. This rule would clamp down on currently legal tax avoidance schemes as well as illegal tax evasion. We will continue to invest in HMRC and seek to extend the requirement for country-by-country reporting from banks and extractive industries to cover all UK listed companies.
I am mildly amused to note that these all seem to be policies pioneered on this blog which means I can't object to any of these, Although I wish they might haver read a bit more and been a bit more radical as a result.
My real question is has anyone seen anything that provides more detail on this from the Lib Dems? And is there any more than this? I know they say they are going to raise £9bn from tackling tax abuse. I had not seen specific policy suggestions before.
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Is this 9bn new money or just what they supposed to have at the moment?
http://www.libdems.org.uk/get_the_facts_tax_dodgers
Hmmmm….£9 billion form these schemes is fanciful wishful thinking
And the claim on tax prosecutions is just wrong, as I have shown on this blog
That page almost qualifies as a ‘dodgy dossier’
Yes indeed. I got the following response from the PPC for Colne Valley – Cahal Burke.
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Thank you for contacting me about my views on the proposed Tax Dodging Bill. I want a tax system that is simple, competitive and fair. The vast majority of people and businesses in the UK pay their taxes on time and in full, but there are always some who try to get away without paying their fair share. This is morally wrong and damages our economy and public finances.
That’s why I’m pleased that Liberal Democrat Chief Secretary to the Treasury Danny Alexander has made tackling tax avoidance a top priority and has made progress on many of the issues you raise. Since coming into Government in 2010 he has led a crackdown on tax avoidance and evasion that is closing loopholes and making more people pay up.
Liberal Democrats in Government have already made over forty changes to the law to close loopholes and make big strategic changes to the way tax is collected to ensure fewer people slip through the net.
The changes we have made include the introduction of a General Anti-Abuse Rule (GAAR); strengthening the Disclosure of Tax Avoidance Schemes (DOTAS) regime; introducing a tougher monitoring regime and penalties for high-risk promoters of tax avoidance schemes; giving Her Majesty’s Revenue and Customs (HMRC) the power to collect disputed tax bills up front (thus removing the incentive for tax avoiders to delay and frustrate HMRC’s efforts to settle disputes); and clamping down on Stamp Duty tax avoidance with a new range of measures.
Another big change was to invest almost £1bn in HMRC to tackle tax avoidance, recruiting 2,500 extra members of staff to work on tackling tax avoidance and opening a new Large Business Directorate last year to deal specifically with the tax affairs of the 2,100 largest firms in the UK. Part of their work will be to enforce the new Diverted Profits Tax, which will counter the use of aggressive tax planning methods used by some big firms to divert their profits to areas with very low rates of tax. We hope this tax will yield an extra £1.35bn over the next five years.
I’m pleased that we have also worked internationally to tackle tax avoidance and that this was one of the main goals of the UK’s presidency of the G8 group of nations. During our presidency, we won G8 agreement on transparency on the real owners of businesses, as well as getting the Organisation for Economic Cooperation and Development (OECD) to develop a country-by-country reporting template for multinationals to report profit and tax information. Over 90 countries are signed up to the new International Comprehensive Report Standards, closing down options for tax cheats, while around £2bn in previously unpaid tax has been brought in from our new agreements with Switzerland and Lichtenstein alone.
There is clearly much more to do at home and abroad, but I am proud of the work that Liberal Democrats have done in Government to close loopholes and force tax cheats to pay more of their fair share. Thanks to the steps we have taken, the tax yield for this year will be around £9bn more than when we came into Government in 2010.
Going forward, Liberal Democrats are determined not to let up in the fight against tax cheats. If we are in Government again our aim is to make progress on this agenda in every Budget and Autumn Statement of the next Parliament. We will continue to invest in HMRC, as we have done in Government, to enable them to do more to tackle tax evasion and avoidance. We will also introduce a range of other measures, including a General Anti-Avoidance Rule, which goes much further than the current anti-abuse rule. We will seek to extend the requirement for country-by-country reporting from banks and extractive industries to cover all UK listed companies. The majority of these proposals will be introduced through the annual Finance Bill, allowing us to take regular action throughout the Parliament.
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Regards
David
It looks like a standard HQ written reply then….most of which eulogises what Danny Alexander might one day want to look back on as his greatest hits album
I’d write back, pointing out that the “almost £1 Bn investment” was actually reinvestment. Thats money cut from other parts of HMRC’s budgets and could partly explain why it now takes them almost 2 months for them to respond to your letters, or the endless hours spent listening to musak whilst trying to get them to fix your tax code out because their new fangled IT
system has screwed it up again. I suppose you could pop into your local tax office to sort it out, then again you might not, because they’re all shut as well.
Isuue of trust as well. They can sound as reasonable as they like. But people know the difference in what they said pre and post 2010. The reality is they just can be trusted on their word. It’s much easier to dish out the medicine to those without resources and power and those with
Interesting to read about how a GAAR is seen as a another weapon for HMRC to solve the problem of tax avoidance. The real question is the interpretation by the courts of those GAAR provisions. After all the courts have an historic bias towards the interpretation that favours the taxpayer, and over time this reduces the impact. Other jurisdictions (eg Australia) have a GAAR and the provisions have been watered down by judicial interpretation, and risk averse tax administration.
While a GAAR is an excellent idea, it still requires competent staff at HMRC to investigate and apply the relevant provisions. Without support from senior leaders of HMRC and government any GAAR will be difficult to administer.
Agreed