TaxCorporate TaxAnti-avoidance alliance may expand to G7

Anti-avoidance alliance may expand to G7

The anti-avoidance initiative between Britain, the US, Australia and Canada, designed to close off loopholes that allow taxpayers to 'hide behind' different tax jurisdictions, may expand to include other countries.

Link: Tax avoidance rules to cost Big Four £1m each

Lord McIntosh of Haringey said the four-country initiative would be located in Washington for the next two years and made it clear that the government may seek to expand it to other members of the G7 or the countries engaged in the Financial Action Task Force.

Crackdown on avoidance sparks fear of exodus

And he told peers: ‘It is important that we should stop the far too prevalent abuse – I shall not use the word ‘abusive’, but I nearly did – when very highly paid lawyers and accountants find ways to deprive the Revenue of monies that parliament would wish to go to the Revenue and to us.’

He brushed aside claims that the best way to reduce avoidance and evasion was to reduce tax levels, insisting that the preservation of public services required action to stop ‘clever people trying to avoid taxes’.

Former Labour Treasury minister and Public Accounts Commission chairman Lord Sheldon said there was a case for trying to co-ordinate anti-avoidance action with other countries.

His definition of ‘abusive avoidance’ caused a number of Lords to challenge Lord McIntosh over the difference between legal ‘avoidance’ and illegal ‘evasion’.

Provisions in the Finance Bill require notification of the use of some avoidance schemes and compel companies to notify the tax authorities when they are considering other schemes with the ‘hallmarks’ of deliberate avoidance.

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