Treasury select committee chair Andrew Tyrie is set to scrutinise George Osborne’s plans to get tough on tax avoidance which include a new criminal offence punishable by a prison sentence for hiding tax offshore.
The BBC reports Osborne has set out plans to clamp down on people who hide their money overseas to avoid paying tax, by hitting them with bigger penalties and potentially making it easier to send people to jail.
Currently, to prosecute HM Revenue & Customs has to prove a person holding income offshore intended to evade paying tax. Under the proposals, there would be a new criminal standard where officials would only have to show money was taxable and undeclared.
Osborne said: “We have already done a lot to crack down on those who do not pay their taxes, now we are introducing a new criminal offence for people who hide their money offshore.”
The Government is expected to issue a consultation outlining the proposals today.
The latest bid to crack down on tax avoidance comes after the Chancellor set out a raft of measures to beef up powers to claim money owed in tax in last month’s Budget.
In the Budget, the Government announced extended powers for HMRC to issue payment notices to anyone who has used an avoidance scheme into which HMRC has an open enquiry. The Government has also proposed to strengthen HMRC’s powers to recover tax directly from debtors’ bank accounts, including Isas.
TSC chair Andrew Tyrie has raised concerns about the move.
He told the Financial Times MPs would take “further evidence on the extension of HMRC’s powers”, including the moves to tackle offshore evasion and a right to dip into taxpayers’ bank accounts to recover unpaid tax.
He said: “We must be vigilant to ensure we don’t lose the essential balance between the powers that HMRC needs and protecting individuals. Parliament needs to pay attention when these powers are extended.”