George Osborne will deliver his autumn statement on 5 December. During Treasury questions yesterday the Chancellor defended the government’s record on tackling tax evasion and avoidance.
Tax revenues from compliance and enforcement were ‘£3bn higher than when we came to office’, and HMRC had raised ‘£500m more in extra tax from high net worth individuals’, he said.
Andrew Tyrie, Conservative MP and chairman of the Commons Treasury Committee, said many MPs had expressed ‘deep concern’ about the development of retrospective tax measures. The Treasury Committee shared those concerns. ‘Does the Chancellor agree that the best way to prevent loss of revenue from avoidance schemes is to work much harder to create a simpler tax system in the beginning?’ he asked.
Osborne replied: ‘I agree that that is of course the best approach, but in the tax code of a western democracy there will inevitably be opportunities for abuse and avoidance, which we need to deal with. When it comes to retrospection, I think the House of Commons should sanction retrospective taxation only when it is very clear that the explicit wishes of parliament have been abused and avoided.’
In a reference to Barclays, Osborne added: ‘For example, in the case of a particular UK bank that his committee and I have corresponded about, we acted retrospectively because there was a clear breach of what parliament had expressed, and I am very pleased to note that the bank’s new chief executive has today said that the bank will be scaling down its tax structuring activities.’
Liberal Democrat MP Simon Hughes asked Osborne to ‘look at those private sector companies that are monopoly providers of public sector services, which have billion-pound turnovers, pay no corporation tax and often channel their money through offshore accounts in places such as the Caribbean and the Channel Islands’. Osborne invited Hughes to bring specific examples to his attention.
George Osborne will deliver his autumn statement on 5 December. During Treasury questions yesterday the Chancellor defended the government’s record on tackling tax evasion and avoidance.
Tax revenues from compliance and enforcement were ‘£3bn higher than when we came to office’, and HMRC had raised ‘£500m more in extra tax from high net worth individuals’, he said.
Andrew Tyrie, Conservative MP and chairman of the Commons Treasury Committee, said many MPs had expressed ‘deep concern’ about the development of retrospective tax measures. The Treasury Committee shared those concerns. ‘Does the Chancellor agree that the best way to prevent loss of revenue from avoidance schemes is to work much harder to create a simpler tax system in the beginning?’ he asked.
Osborne replied: ‘I agree that that is of course the best approach, but in the tax code of a western democracy there will inevitably be opportunities for abuse and avoidance, which we need to deal with. When it comes to retrospection, I think the House of Commons should sanction retrospective taxation only when it is very clear that the explicit wishes of parliament have been abused and avoided.’
In a reference to Barclays, Osborne added: ‘For example, in the case of a particular UK bank that his committee and I have corresponded about, we acted retrospectively because there was a clear breach of what parliament had expressed, and I am very pleased to note that the bank’s new chief executive has today said that the bank will be scaling down its tax structuring activities.’
Liberal Democrat MP Simon Hughes asked Osborne to ‘look at those private sector companies that are monopoly providers of public sector services, which have billion-pound turnovers, pay no corporation tax and often channel their money through offshore accounts in places such as the Caribbean and the Channel Islands’. Osborne invited Hughes to bring specific examples to his attention.
