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HMRC's latest move to combat tax evasion ruins the credibility of the Offshore Disclosure Facility (ODF) and could be a waste of time, believes tax investigation expert Scott Gilbert.
In an interview with The Sunday Times, acting Revenue chairman Dave Hartnett announced a new push to track down tax evaders with bank accounts in Europe and the Channel Islands. He said that those who come forward voluntarily will enjoy reduce penalties — although the system for calculating fines will be more complex than previously.
Mr Hartnett also told the newspaper that HMRC will seek prison sentences for tax evaders who do not hand themselves in — and the new deal may not apply to those who avoided last year's ODF.
However, Scott Gilbert is doubtful about the taxman's new scheme. He believes that the 2007 'offshore amnesty' — which raised £400 million, far less than the £1.75 billion originally predicted by the Revenue — was not particularly successful, and that it generated a great deal more information than has been best exploited.
'I might be nice to get the ODF right before jumping up and down about the new plan,' said Mr Gilbert in response to Mr Hartnett's reported remarks.
'The ODF was expected to be a one-off, and this new amnesty ruins the credibility of the first one. Why will people tax this one seriously?'
Scott added that the many tax evaders who did not come forward last year are even less likely to do so this time, and many others will be willing to 'take their chances' given that the levels of reprisal are now higher than before.
'Those who did own up might now wish they hadn't,' said Scott, whose company, Gilbert Tax, won the Best Investigations Team prize at this year's Taxation Awards.
He then criticised HMRC for not following up 'thousand of pieces' of information garnered during the ODF and suggested that many of the department's employees tasked with handling the data were not properly trained to do so.
The new amnesty was first mooted by HMRC last November, and was castigated at the time by tax expert John Whiting for undermining incentives for tax evaders to come forward in the future.
However, it is only now that the Revenue has formally revealed its plans to hunt down tax evaders with bank accounts in overseas havens.
