Second offshore amnesty 'not logical'

But HMRC say they are only looking at the possibility of launching a new offshore disclosure facility (ODF).

The move could undermine any incentive for tax evaders to volunteer their liabilities in future, claimed tax investigation expert John Cassidy, as HMRC were receiving the final payments from the first ODF, set earlier this year.

John, a tax partner with PKF, said: 'There would be no logic to setting the penalty for a second ODF at the same 10% level and still allowing those who ought to have come forward the first time to use the new facility.

'Where is the incentive to come forward now, rather than wait until a later exercise? There is a serious danger that such exercises will stop being taken seriously if they happen every year without change.'

However, HMRC said they are only considering another ODF, and have not yet fully discussed all the details, which centre mainly on fairness. For example, would a person who had not taken advantage of the first facility be allowed another chance?

There was, added HMRC, also the question of obtaining the relevant information from the 170 banks with whom the Revenue has been in discussion.

There could be a whole raft of special commissioners' decisions to give HMRC access, but this would take time.

John Cassidy went on to remark: 'What I think is needed is an updated model. The priority must be to incentivise more people to come forward, and there are certainly lessons to be learnt from the first exercise.

'For instance, HMRC asked people to calculate and disclose unpaid tax as far back as 20 years, which I believe dissuaded many people from utilising the facility.

'They either didn't have the old records anymore, or it was simply such a daunting task that they would rather risk not disclosing.

'Reducing the length of time to be investigated to six years, perhaps counter-balanced by a different penalty structure, would provide a much greater incentive to people, which is the key issue.

'The more people come forward, the more tax arrears HMRC will collect. They should give more to get more.'

Categories: News , ODF , offshore disclosure facility