Tax Avoidance Schemes – New Measures

New measures are being taken by the government against tax avoidance schemes. During the last few years more and more wealthy people were thinking of different ways to avoid the rulesand hide taxes.

Tax reduction firms, which exploit measures in order to lower taxes “artificially and aggressively” might be forced to reveal details about their clients, declared the Treasury minister David Gauke.

This was provoked after famous Jimmy Carr`s case, where he was involved in a complex scheme to reduce tax, an action described by David Cameron as “morally wrong” . The government is aware such schemes exist and is now seeking measures to reduce the occurrence of such activity. These schemes are not actually illegal, however they are considered to “go against the spirit of the law”

Tax Reduction companies, which refuse or fail to provide the government with the details of their clients- those who are engaged with tax reduction. In addition, these companies will be required to explain and show how these tax reduction schemes actually work.

The Treasury minister explained that the definition of tax avoidance are ambiguous. There needs to be taken action against such operations and everything should be legally proclaimed. The new laws will clarify what is “right” and “wrong” with tax avoidance practices.

In a speech, Gauke stated:
“We are building on the work we have already done to make life difficult for those who artificially and aggressively reduce their tax bill. These schemes damage our ability to fund public services and provide support to those who need it. They harm businesses by distorting competition. They damage public confidence. And they undermine the actions of the vast majority of taxpayers, who pay more in tax as a consequence of others enjoying a free ride.”