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HMRC consult on new powers under the tax avoidance disclosure regime. By Nichola Ross Martin

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18th Dec 2006
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Following an announcement in the Pre Budget Report, HMRC have issued a consultation document to consider proposals to grant them new powers under the tax avoidance scheme disclosure regime.

At present they have no power to enquire into the failure to disclose a scheme, and whilst many scheme promoters are complying with the new disclosure rules, a small number are not.

The consultation is intended to ensure that the proposed information power will be "a proportionate and targeted response to any non-compliance encountered". The power would be exercised via the Special Commissioners.

Paymaster General, Dawn Primarolo, said:

"Tax avoidance costs the Exchequer lost revenues each year. It also undermines government public spending objectives and brings unfairness into the tax system itself.

"The Government is determined to adopt a robust approach in
countering avoidance.

"This power will benefit the compliant majority by creating a level playing field and is a proportionate response by Government to frustrate those determined to avoid paying their fair share."

Disclosure has allowed Government and HMRC to take timely and targeted action against tax avoidance.

The new taxes management act is also under consideration and the first two batches of its clauses are also consideration. HMRC launched a consultation document last year into “Deterrents, powers and safeguards”.

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