| HMRC defends steps against secret Liechtenstein accounts |
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| Tuesday, 26 February 2008 | |
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HM Revenue and Customs has issued a statement after newspapers revealed it had paid an informant £100,000 in return for stolen data on secret UK accounts in Liechtenstein.
HM Revenue and Customs (HMRC) said that tax administrations in Australia, Canada, France, Italy, New Zealand, Sweden, United Kingdom, the United States of America, and others - all member countries of the OECD's Forum on Tax Administration (FTA) - were working together following “revelations” that Liechtenstein bank accounts are being used for tax avoidance and evasion. Differences of opinion HMRC said it had opened enquiries into UK residents who have Liechtenstein accounts to establish whether the accounts had been disclosed for tax as UK law requires. It added that many had not been disclosed, but declined to respond to criticism that it had handled stolen goods to obtain the information. Legal experts have voiced differences of opinion on whether HMRC’s two wrongs made a right. Some questioned the ethics of HMRC's actions and others doubted whether stolen data were admissible in a court of law. HMRC acting chairman Dave Hartnett said that tax evasion was not a victimless crime. “Honest citizens have to meet the cost of the tax that is evaded by a minority who are dishonest. Tax cheats deprive our public services of vital funding,” he added. OECD standards Hartnett explained that everyone was entitled to conduct their financial affairs in privacy but that secrecy laws which facilitate tax evasion were completely unacceptable. He called on those who had hidden their income and gains from HMRC to come forward and make a prompt and complete disclosure. The Organisation for Economic Cooperation and Development's (OECD) blacklisted Liechtenstein in 1999 as an uncooperative tax haven, alongside Andorra and Monaco. “In the light of recent developments involving Liechtenstein bank accounts, there needs to be a significant move towards full implementation of OECD standards on transparency and effective exchange of information in tax matters," Hartnett concluded. All the countries now working together were represented at the FTA's September 2006 meeting in Seoul, Korea when Tax Commissioners from more than 30 countries identified the use of tax haven bank accounts as a major threat to successful tax administration. The Commissioners said they would continue to re-examine the effectiveness of the measures in place to protect tax bases and to consider whether new measures might be needed. At the FTA 2008 meeting in South Africa, the Commissioners agreed to study the role of banks in tax compliance. Related articles
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