TaxPersonal TaxSwiss deal ‘could cost billions’

Swiss deal 'could cost billions'

Research network says UK/Switzerland agreement undermines EU wide efforts to increase transparency

THE DEAL between the UK and Switzerland could cost the Exchequer billions, the Tax Justice Network (TJN) has warned.

The research group has said that HM Revenue & Customs’ estimates of up to £7bn being collected are improbable and the real figure will be closer to £1bn. Because multilateral efforts to make Switzerland more transparent have been affected by this deal and a similar one between Germany and Switzerland, the deals could cost the UK in the long run.

The agreement will impose a one-off payment on the capital in Swiss accounts and will charge a withholding tax on future payments. However, TJN says it has identified ten loopholes that will make it easy for the most aggressive evaders to avoid the charges.

These include: a failure to tackle discretionary trusts, foundations and similar structures; the ability of evaders to move their money to branches in other countries; and the fact that the withholding tax does not extend to wages, royalties, income on property or loans.

An HMRC spokesman said: “The Swiss agreement will deliver billions of pounds to the UK that would otherwise have been lost. It will deliver significantly more than under the EU agreement with Switzerland.”

Related Articles

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 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
Wealthy individuals could circumvent top tax rate rises

Personal Tax Wealthy individuals could circumvent top tax rate rises

9m Alia Shoaib, Reporter
Industry reaction: Taylor Review does not go far enough in addressing tax issues

Legal Industry reaction: Taylor Review does not go far enough in addressing tax issues

10m Alia Shoaib, Reporter
HMRC tax evasion assistance requests double in five years

Corporate Tax HMRC tax evasion assistance requests double in five years

11m Emma Smith, Managing Editor
Rangers tax case to have ‘dramatic’ consequences for football and business

Legal Rangers tax case to have ‘dramatic’ consequences for football and business

11m Emma Smith, Managing Editor
HMRC collects record £5bn in inheritance tax

HMRC HMRC collects record £5bn in inheritance tax

11m Emma Smith, Managing Editor
The top three issues that the next government must address for accountants

Making Tax Digital The top three issues that the next government must address for accountants

11m Emma Smith, Managing Editor