In light of the recent row over comedian Jimmy Carr’s tax affairs, the Treasury has, today, announced plans for a crackdown on tax avoidance schemes.
We can expect HMRC government to force aggressive tax avoidance promoters to reveal their lists of clients to inspectors following the revelation that comedian Carr was paying just 1% tax on his income.
However, the current government’s plan to properly tackle tax avoidance schemes has come under pressure, with scepticism growing on the effectiveness of the Tories’ intentions, with so many members of the party closely associated with tax avoidance.
Will the public deem this latest plan as populist rhetoric, or is this a step in the right direction?
Simon Danczuk, the Labour MP for Rochdale, said: “It tells you everything you need to know about this government that ministers have chosen to give a speech on tax avoidance at an organisation whose trustee, the Conservative donor George Robinson, has just been found to have used an offshore avoidance scheme and had to pay back millions of pounds.
“With billions of pounds estimated to be lost each year, this government is failing to tackle tax avoidance, while also giving a tax cut to millionaires. How can it be fair to cut taxes for the very richest while ordinary families, pensioners and businesses are feeling the brunt of this double-dip recession?” he said.
In the past, many governments have issued pledges to crackdown on tax avoidance. We’ll believe it when we see it.