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Spring Statement 2019: Tax avoidance, evasion & non-compliance

The government has previously stated its ongoing commitment to keeping the tax administration framework under review to ensure that it ‘continues to strike the right balance between robustly challenging tax avoidance, evasion and other forms of deliberate non-compliance, and treating all taxpayers fairly’. Finance Act 2019 subsequently contained provisions introducing statutory reporting requirements by the government on certain anti-avoidance measures (FA 2019, s 92 and 93).

HM Treasury and HMRC have published a joint policy paper setting out the government’s approach and achievements in tackling tax avoidance, evasion and other forms of non-compliance. The document is split into three chapters, which:

– outline HMRC’s strategy and approach to compliance for different taxpayers
– detail the government’s record in addressing areas where risks of non-compliance have been identified; and
– provide a summary of the government’s record of investment in HMRC and its commitment to further action.

The policy paper can be found here.

Offshore tax compliance strategy: No safe Havens 2019

The Government’s No Safe Havens 2019 publication is a policy paper setting out the direction for HMRC’s updated strategy for offshore tax compliance, bringing together the government’s response to all forms of offshore non-compliance. This reflects the substantial progress that the UK has made since the last strategy was published in 2014 and complements the paper on avoidance and evasion activity to date.

The policy paper can be found here.

Under the same heading of Tax avoidance, evasion & non-compliance, in the coming months the government will publish the following:

Preventing abuse of the R&D tax relief for small- or medium-sized enterprises (SMEs)

A consultation is to be launched on the measure announced at Budget 2018, as part of the package on tax avoidance. This consultation will focus on how the measure will be applied, to minimise any impact on genuine businesses.

Insurance Premium Tax operational review
There will be a call for evidence on where improvements can be made to ensure that Insurance Premium Tax operates fairly and efficiently.

VAT Administration in the Isle of Man
Following the Paradise Papers allegations, the Isle of Man Government invited HM Treasury to review its VAT administration processes for the importation of aircraft and yachts. HM Treasury is to publish its findings and recommendations to ensure the right VAT continues to be paid and collected in the Isle of Man.