Sunday, September 06, 2009

Offshore warning - tax evaders beware

This advertisment features prominently in the Sunday newspapers. Read the small print and you will see that Her Majesty's Revenue and Customs service is offering tax dodgers the opportunity to declare their offshore accounts before 30th November and incur a reduced penalty rate of only 10 per cent. Leaving it beyond that date could incur a higher penalty rate of 100 per cent. And then, ominously for those who think that banks in tax havens can still cover their tracks, the notice says "We can now obtain the details of offshore bank accounts - so its best to act soon."
Is this a sign that the government will pay as much attention to tax dodgers as they do to benefit fraudsters? The lead article in my local newspaper this week tells that a benefit cheat in Buckinghamshire has been jailed for 15 months after falsely claiming income support, single person allowance and council tax reduction. The person in question is a mother of five, and a migrant living in relatively impoverished circumstances. Tax Justice Network does not in any way condone benefit fraud, which is a crime against the public. But we note that whilst benefit fraudsters face severe penalties, tax dodgers -- often the most privileged and wealthiest in our divided society -- generally receive more leniency. Eighteen months after the German authorities indicted Deutsche Post CEO Klaus Zumwinkel on tax evasion charges we still await news of criminal proceedings against anyone in Britain who is involved in the Liechtenstein bank scandal.
Tax dodging is every bit as harmful to public interest as benefit fraud. Whether it consists of evasion or avoidance, it is the public that ultimately pays for the activities of a selfish few. The sums involved are humungous. Initiatives such as this to tackle the tax dodging culture are very welcome, but if benefit fraudsters deserve public naming and shaming, and the custodial sentences meted out by the courts, justice requires equivalent treatment for tax dodgers.


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