Not enough tax evaders prosecuted, says MPs’ standards committee
EVEN the offices of HM Revenue and Customs are privately owned offshore — so it’s not surprising it has “completely forgotten its purpose” in making rich tax evaders pay, financial reform campaigners said yesterday.
Joel Benjamin told the Star that the HMRC headquarters is registered in Jersey for tax avoidance purposes to CIHL Infrastructure Holdings.
Its 600 offices around Britain have been collectively owned and controlled by Bermuda-registered Mapeley Steps Limited for the same reasons, he added.
Mr Benjamin, of The People vs PFI campaign, spoke out after the “woefully inadequate” HMRC was exposed by MPs in a highly damning report for only prosecuting 11 offshore tax evaders — out of 11,000 individuals potentially involved in tax evasion — in the past five years.
The Commons public accounts committee said that the Tory-imposed funding cuts have had an “adverse impact” on collecting much-needed tax revenue.
HMRC customer service and staff numbers are so “abysmal” that half of all calls go unanswered. At least 11,000 full-time employees have been made redundant since 2010, which the Public and Commercial Services union (PCS) said has left it buckling under pressure.
PCS general secretary Mark Serwotka said: “It has been abundantly clear for years that the department has cut too many staff and that services are suffering.
“The department needs major investment backed by a real political commitment to tackle tax evasion and avoidance as an alternative to more damaging spending cuts.”
Committee chair Meg Hillier said: “It beggars belief that, having made disappointing progress on tax evasion and avoidance, the taxman also seems incapable of running a satisfactory service for people trying to pay their fair share.”
The committee said that HMRC ignored previous calls to stop people’s “aggressive tax avoidance.”
Around 3,600 people were listed on the “Falciani list” — a list of alleged tax evaders — that was leaked by a whistleblower at HSBC’s private Swiss bank.
Despite launching 950 inquiries, HMRC told the committee that it had now “exhausted” its use of the Falciani data which “did not meet the standards required for UK evidence.”
HMRC has offered “disclosure facilities” — or reduced penalties — to those who admit the true value and number of their assets hidden overseas.
But the committee said it was no substitute for prosecution.
The report added: “HMRC’s investigations do not lead to sufficient prosecutions to provide an effective deterrent, particularly for wealthy individuals who hide their assets offshore.
“The vast majority of UK individuals pay what is due from them in tax.
“Those who do not must in future know that they could face prosecution if they deliberately seek to evade paying what is due.”
It is “no surprise” that a small group of rich people have been prosecuted for not paying their full rate of taxes, Mr Benjamin added.
He continued: “It is now indisputable that HMRC, like many other government institutions, has been entirely captured by notions of laissez faire, soft-touch regulation and has completely forgotten its purpose and who it serves.
“Evidently non-dom high society, not British society.”