Latest tax news
Tax is never far away from the financial news. In this post we have put together some of the latest snippets that should be of interest to all those wishing to manage their tax affairs.
Thinktank proposes asset tax for over-65s
The Social Market Foundation has said homeowners and people with substantial savings should face a one-off “asset tax” of £30,000 when they reach 65 to fund England’s care system for the elderly. The thinktank estimates such a charge would raise £7bn a year and enable care in residential settings and in people’s homes to be delivered free, rather than based on a means test as now. It argued that it was not fair to force people of working age to pay more tax to fund care for older people. The Social Market Foundation said that the charge of £30,000 should be levied on anyone with assets worth more than £150,000 and paid when they turned 65 or deferred until their death.
Reported in The Times, on 13 Sep 2018
Labour budgeting for 15 years in power
Labour’s John McDonnell has said the party is preparing for a 15-year stretch in government, with plans to spend £500bn in the first 10 years. The shadow chancellor said Labour’s spending commitments would be funded by increasing taxes on the top 5% of earners, rises in corporation tax, a tax on financial transactions in the City of London and tackling “industrial scale” tax avoidance and evasion. He also claimed the measures were backed by the CBI, although the lobby group has distanced itself from Mr McDonnell’s comments.
Reported in The Times The Daily Telegraph, Financial Times, Daily Mail on 12 Sep 2018
Boris tax cut promise is ‘sheer folly’
On the other hand, looking at the Conservative party The Times’ writer Daniel Finkelstein pours scorn on Boris Johnson’s suggestion of sweeping tax cuts to boost the economy. He says the idea that tax cuts pay for themselves is “seductive, but false” and that the Conservative Party needs to offer more to voters.
Reported in The Times, on 12 Sep 2018
HMRC will use social media to pinpoint tax evaders
HMRC has said it will “observe, monitor, record and retain internet data”, including blogs and social networking sites, to detect tax evasion. The guidance on criminal investigations for tax offences also mentions other ‘open source’ internet sources which HMRC will monitor such as news reports, internet sites, Companies House and land registry records. “The guidance confirms what we already know – that HMRC plugs huge amounts of data into its state of the art ‘Connect’ computer system to identify those who may not be paying the tax they should,” said Steven Porter a tax disputes expert at Pinsent Masons.
Reported in International Adviser on 11 Sep 2018
John Lewis boss rejects ‘Amazon tax’ call
John Lewis chairman Sir Charlie Mayfield has rejected growing calls for online retailers to be hit with a so-called “Amazon tax”. Writing in the Telegraph, Sir Charlie said he “struggled” with the belief that internet companies should be penalised because they have managed to carve out a leaner business model.
Reported in The Daily Telegraph on 10 Sep 2018
HMRC reluctant to prosecute the rich
HMRC has admitted that it allows the most powerful members of society to escape prosecution for financial crimes. Richard Las, the deputy director of HMRC in charge of organised crime, told an economic crime conference in Cambridge last week that the tax authorities accommodated celebrities’ concerns and settled debts privately to avoid the embarrassment of a public trial. He admitted that “criminal justice” was never a “default option” for HMRC. “We use it where it is necessary and it will have the greatest effect”, he said. Prem Sikka, professor of accounting at Sheffield University, said: “This shows just how far removed the senior leadership of HMRC are from public opinion. This policy provides absolutely no deterrent to tax cheats.”
Reported in The Sunday Times on 9 Sep 2018
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