22/11/2011

Tax Office Launches Offshore Unit

A specialist unit targeting offshore tax cheats has been launched by HM Revenue & Customs (HMRC) on Tuesday.

According to HMRC, the Offshore Co-Ordination Unit (OCU) will use a team of "highly-skilled" offshore analysts, technical tax experts and experienced investigators, who will assist identifying and pursuing those who hide income and capital in offshore accounts to avoid UK tax and duties.

The unit will use the increasing offshore information at HMRC’s disposal, including bank account data and develop new ways of tackling offshore tax evasion.

Exchequer Secretary to the Treasury, David Gauke, said: “The days when untaxed income or capital could be safely salted away offshore, beyond the reaches of the taxman, are long gone.

“The launch of this specialist unit, together with the other valuable work the department is driving forward in an effort to tackle offshore evasion, underlines the fact that offshore tax cheats are fast running out of places to hide.”

The news comes that day after a report recommended the Government consider tougher rules on tax avoidance, which could see the first general rules applied to tax dodging.

The recommendation comes from the final report of QC Graham Aaronson’s eleven month review of the feasibility for the UK tax system of a General Anti-Abuse Rule (GAAR), which would deter abusive tax avoidance schemes, contribute to providing a more level playing field for business and reduce legal uncertainty around tax avoidance schemes.

The report recommends that a GAAR should initially apply to the main direct taxes – income tax, capital gains tax, corporation tax, and petroleum revenue tax, as well as national insurance contributions.

Speaking in response to the publication of the review’s recommendations, David Gauke, Exchequer Secretary to the Treasury, said: “The Government is committed to tackling tax avoidance. We asked Graham Aaronson to consider whether a UK GAAR could deter and counter tax avoidance, while providing certainty, retaining a tax regime that is attractive to businesses, and minimising costs for businesses and HMRC. We welcome the completion of his study and will carefully consider its recommendations against these criteria, alongside the feedback from businesses and tax professionals that we look forward to receiving.”

The Government said it will consider the report and the extent to which the proposals could add to existing approaches and further reduce levels of tax avoidance.

The Government is expected to discuss the implications of the proposed rule with business and tax practitioners and respond fully at Budget 2012, setting out its plans for further, formal public consultation, if appropriate.

(DW)

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