Shadow chancellor Ed Balls said that the Labour Party, if elected, would bring in tough new penalties to tackle and deter tax avoidance.
Shadow chancellor Ed Balls said that the Labour Party, if elected, would bring in tough new penalties to tackle and deter tax avoidance. Balls said Labour had ‘highlighted a series of areas where this government has failed in their responsibility to act swiftly and decisively, but Labour will deliver, such as closing down the eurobonds loophole, addressing umbrella companies and false self-employment, tackling dormant companies and stopping avoidance by hedge funds,’ and called for global reform of the tax rules.
‘But this agenda will only be delivered if HMRC has the powers and resources it needs to act,’ he added. ‘We have supported the introduction of a general anti-abuse rule (GAAR). Those who set up abusive schemes should run the risk of being caught by such a rule, but it is currently a GAAR without teeth.
‘Those who are caught have to repay the tax they tried to avoid, but they do not face a penalty. There is still no disincentive to try and game the system. That is why Labour will bring in a tough penalty regime for the GAAR, with fines of up to 100% of the value of the tax which was avoided. For the first time this will provide a tough and genuine deterrent to those who try to abuse the system and avoid paying their fair share of tax … Through measures such as this we can ensure that no-one pays zero tax at the top so we can get the deficit down fairly, invest in our NHS, and maintain public support for the dynamic open economy we need.’
Shadow chancellor Ed Balls said that the Labour Party, if elected, would bring in tough new penalties to tackle and deter tax avoidance.
Shadow chancellor Ed Balls said that the Labour Party, if elected, would bring in tough new penalties to tackle and deter tax avoidance. Balls said Labour had ‘highlighted a series of areas where this government has failed in their responsibility to act swiftly and decisively, but Labour will deliver, such as closing down the eurobonds loophole, addressing umbrella companies and false self-employment, tackling dormant companies and stopping avoidance by hedge funds,’ and called for global reform of the tax rules.
‘But this agenda will only be delivered if HMRC has the powers and resources it needs to act,’ he added. ‘We have supported the introduction of a general anti-abuse rule (GAAR). Those who set up abusive schemes should run the risk of being caught by such a rule, but it is currently a GAAR without teeth.
‘Those who are caught have to repay the tax they tried to avoid, but they do not face a penalty. There is still no disincentive to try and game the system. That is why Labour will bring in a tough penalty regime for the GAAR, with fines of up to 100% of the value of the tax which was avoided. For the first time this will provide a tough and genuine deterrent to those who try to abuse the system and avoid paying their fair share of tax … Through measures such as this we can ensure that no-one pays zero tax at the top so we can get the deficit down fairly, invest in our NHS, and maintain public support for the dynamic open economy we need.’
