Police state warning

The UK is danger of becoming a ‘police state’ in its treatment of taxpayers, an audience of accountants and business leaders was warned last week.

Speaking at the Hardman lecture at the English ICA, Peter Wyman, a partner at PricewaterhouseCoopers, hit out at the attitude prevailing in some quarters of the government that any means of preventing tax avoidance were justified, even when ordinary people doing ordinary things were severely disadvantaged.

‘There is a fine line between appropriate measures and inappropriate actions of the sort more commonly associated with a totalitarian state,’ Wyman said.

Taxpayers, he argued, had been placed in an unacceptable position by uncertainty about disclosure requirements. ‘There needs to be clear, and probably binding, accord on what constitutes proper disclosure. Only with such an agreement can the rights of the ordinary taxpayer be protected,’ he said.

The introduction of self-assessment and proposals for a general anti-avoidance rule, he added, were increasing the uncertainty about disclosure.

Wyman challenged the ICA’s tax faculty to lead professional bodies in drawing up full guidance on what constitutes proper disclosure.

This, he said, should be presented to the Inland Revenue and Customs & Excise, who would be asked to state clearly whether they agreed or disagreed with it.

The tax faculty said it was seriously considering the proposal and other points raised by Wyman, but had not yet come to any firm decisions on the way forward.

A spokesman said the lecture had raised a number of topical issues which needed to be resolved.

He also said the faculty was delighted that the lecture had prompted so much interest. Around 300 people attended, the largest audience since the first event in 1993.

The annual lecture is named after the late Philip Hardman, who was well known for his extensive writing, lecturing and broadcasting on all areas of tax.

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