TaxPersonal TaxPrimarolo warns on tax avoidance

Primarolo warns on tax avoidance

The government has issued its stiffest warning yet against artificial forms of tax avoidance.

Paymaster general Dawn Primarolo has won unprecedented Tory backing for outlawing rent factoring designed to secure excessive tax relief and announcing swift counter-action if any similar schemes emerge.

And she warned those engaged in ‘a game of cat-and-mouse’ between tax planners and the Revenue that the government would stop the abuse.

She told MPs on the Finance Bill Committee: ‘This is the warning: we will not hesitate to act against any equivalent schemes that are designed to obtain a tax deduction that is not justified by the true substance of the transaction.’

And shadow finance minister Oliver Letwin said: ‘The government is absolutely right and it is astonishing this action has not been taken before.’

He said the Opposition would support similar action against analogous activities – particularly against distortions involved in leasing schemes – and a future Conservative government would do the same.

The crackdown will apply only to schemes entered into after Budget Day.

Related Articles

Inheritance tax is 'unfit for modern society' and should be abolished, says think tank

Personal Tax Inheritance tax is 'unfit for modern society' and should be abolished, says think tank

3w Alia Shoaib, Reporter
Rent-a-room relief – the survey says…

Personal Tax Rent-a-room relief – the survey says…

2m Helen Thornley, ATT Technical Officer
What should the OTS prioritise in its review of inheritance tax?

Personal Tax What should the OTS prioritise in its review of inheritance tax?

4m Alia Shoaib, Reporter
LITRG urges government to consider tax changes in disability work plan

Administration LITRG urges government to consider tax changes in disability work plan

5m Lucy Skoulding, Reporter
HMRC appeal rejected in Tottenham Hotspur case

Administration HMRC appeal rejected in Tottenham Hotspur case

6m Emma Smith, Managing Editor
HMRC urged to clarify impact of income allowances on Self-Assessments

Personal Tax HMRC urged to clarify impact of income allowances on Self-Assessments

7m Alia Shoaib, Reporter
New trading allowance: simplicity, but not as we know it

Administration New trading allowance: simplicity, but not as we know it

7m Emma Rawson, ATT Technical Officer
Wealthy individuals could circumvent top tax rate rises

Personal Tax Wealthy individuals could circumvent top tax rate rises

9m Alia Shoaib, Reporter