A new offence of ‘knowingly failing to meet basic tax obligations’ could dumb down the legal process and threaten honest taxpayers with a loss of their right to trial by jury, tax experts warned this week. The warnings came as the proposed measures were published in a Treasury report on the shadow economy which lays out new incentives for tax compliance and sanctions for those who defraud the state. Precise details of the new offence, suggested in Lord Grabiner’s report, The Informal Economy, will be announced in next week’s Budget. The new offence would cover fraud involving smaller sums being tried in magistrates’ courts when normally only large-scale fraud is dealt with using criminal proceedings. John Gwyer, director of tax investigations at Parnell Kerr Forster, said: ‘My real concern is that individuals would lose their right of trial by jury in crown court if the offence is tried in a magistrates court. It would represent a dumbing down of the legal process.’ Gwyer also said magistrates may not be qualified to judge the subtle issues involved in a fraud case and worries about the advice given to defendants. Francesca Lagerberg, technical manager of the English Institute’s Tax Faculty, said the report had been produced too close to the budget for it’s measures to be given full consideration: ‘Whilst not condoning tax evasion in any form, I do think the new rules appear to offer wide-ranging powers to the tax authorities over and above what is necessary,’ she said. ‘They therefore could be detrimental to an honest taxpayer.’ She added: ‘Representative bodies’ should be consulted before the measure is enacted.’ Grabiner’s report concludes that increasing fines for those evading income tax is no solution. The Budget may also offer an amnesty for offenders though Lord Grabiner did not recommend it.
Crowe Clark Whitehill , the top 20 accountancy firm, has announced the promotion of Chris Mould to partner
The latest opinions from Accountancy Age on Making Tax Digital, and outline plans to evolve the UK's corporate governance regime
Five million taxpayers are ow using digital personal tax accounts (PTA) as part of the making tax digital strategy, HMRC said
UK-based non-doms have paid ten times more tax than the average taxpayer, raising concerns over the Brexit impact on non-dom contributions and therefore, the economy