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MP’s call for HMRC to take action over tax avoiders


MP’s have criticised HM Revenue & Customs (HMRC) for not acting quickly enough when it comes to action against tax avoiders.

The Public Accounts Committee believes the HMRC is taking “unacceptably slow” action, and believe they “must do more, faster”. They are calling for HMRC to take a more active role in preventing tax avoidance schemes, as it comes to light that up to £10 million of taxes avoided by 2,000 people in a specific scheme may not be recoverable. In thirty cases HMRC failed to start inquiries into personal tax returns within the 12 month deadline.

The scheme was called “Liberty” and was deliberately designed to avoid tax, and reportedly used by celebrities including singer Katie Melua, George Michael and Gary Barlow. It was said to have helped shelter £1.2bn from the Treasury.

Margaret Hodge, chair of the committee, said:

"Although HMRC says Liberty was an exceptional case among the 750,000 personal tax return inquiries each year, it was unable to tell us how much delays had cost across the different tax avoidance schemes."

The Committee also expressed concerns over HMRCs failings in tackling companies that have taken advantage of international tax structures to reduce their UK tax bills. In December 2013, the MPs accused HMRC of "losing its nerve" when mounting tax prosecutions against multi-national corporations.

Margret Hodge said:

"Research into seven companies who have recently relocated to the UK for tax purposes showed very little inward investment was generated or jobs created in the UK in return for the tax benefits the companies receive,"

"HM Treasury and HMRC should provide the committee with details of progress in identifying and addressing the ways that international tax structures are exploited, and set out the actual costs and benefits of recent changes to the UK's tax regime."

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