Tax experts have expressed deep concern about new legislation to tackle tax evasion and money laundering as the government moved this week to put accountants at the centre of its campaign against terrorism.
The Chartered Institute of Taxation fears the Proceeds of Crime Bill could ‘disastrously’ turn the tax system into a ‘confrontational’ procedure and turn tax inspectors into policemen.
The fears centre around proposals in the bill to require professionals to report suspicion or knowledge of tax evasion to the National Criminal Intelligence Service – a measure which they say could mean innocent mistakes being reported as criminal acts.
The CIoT concedes tough tax legislation is needed, but said people may think twice before attempting to put their tax affairs in order. John Whiting, president of the CIoT, writing in today’s Accountancy Age, said: ‘If tax payers don’t have the confidence that disclosure means no prison, either more errors – and evasion – will escape detection, or the Revenue will have to devote more resources to prosecutions.’
Meanwhile, home secretary David Blunkett and chancellor Gordon Brown announced measures to combat terrorism including the creation of a taskforce containing forensic accountants.
The new anti-terrorist finance unit will be based with NCIS.
In a statement in the House of Commons on Monday Brown said: ‘To further improve financial intelligence a new task force will also bring into the anti-terrorism effort the best of academic, financial and commercial expertise using the best skills of forensic accountancy in tracking assets.’
Underground banking will also be investigated by the new unit, which will involve many agencies including Special Branch.
There were also commitments from both Blunkett and Brown that barriers would be removed that currently prevent Customs & Excise and the Inland Revenue from providing certain information to the police.
The government is also to consult on a requirement for ‘proper disclosure of beneficial ownership of companies’.
– See John Whiting column page 4
– Blair rejects City links with terror www.accountancyage.com/Business/1125577.
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