Posted on Sep.05, 2016 by awaller in Latest News
Government plans to sanction professional firms, which devise schemes that are designed to minimise tax, and which have been successfully challenged by HM Revenue & Customs, have been criticised as blurring the line between tax avoidance and tax evasion.
Mark Joscelyne, partner and head of the tax group at law firm Olswang’s described the proposals as “very worrying”. He commented that “First, they represent a further blurring of the crucial distinction between tax evasion, which is nothing short of theft, and tax avoidance, which is highly subjective and essentially relies on the interpretation of often complex legislation which may or may not be ambiguous.”
“Secondly, it threatens both the rule of law and the right of any citizen to base his actions on the law as it stands… and the ability for commercial people to go about their business.”
Mr Joscelyne said that changing attitudes meant that practices which were acceptable by HMRC at a previous time would now come under scrutiny, with the result there was “a real danger” that “bona fide intermediaries and advisers will feel extremely vulnerable to giving any advice that might ultimately be construed as tax avoidance, thereby stultifying… many commercial transactions where there is any scope for the assertion that tax has somehow been avoided.”
As far as investment is concerned, the Government appears to be discouraging any schemes other than those which it has itself specifically approved, such as pensions, ISAs, VCTs, EIS and BPR.