Chancellor sets sight on evasion - KPMG | KPMG | UK

Spring Statement 2018 Chancellor sets sight on evasion - KPMG

Chancellor sets sight on evasion - KPMG

Commenting on the Spring Statement, Mandy Pearson, partner and head of tax policy at KPMG in the UK, said:

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“In Budgets of yesteryear we were accustomed to multiple announcements about legislative changes to close avoidance loopholes. This is now long gone. As the latest Tax Gap publication shows, the revenues lost to tax avoidance have fallen to a small proportion of the overall tax gap. The Chancellor is reflecting this trend by focusing his attention on tax evasion and other non-compliance. 

“The Chancellor has published five consultation documents with a theme of reducing opportunities for non-compliance, aiming to close the Tax Gap. The main focus is on VAT and the use of digital advances and new technologies to collect taxes.”

They are: 

• Combatting online VAT fraud by means of a new system to withhold VAT on online sales and transfer it direct to HMRC;

• Consideration of ways to soften the cliff-edge VAT registration threshold which deters expansion of small businesses but also encourages evasion;

• Extending the security deposit rules that prevent taxpayers from side-stepping tax liabilities by using contrived insolvencies;

• Discussion of options for preventing cash being used to evade tax and launder money;

• A call for evidence of how the Government and online markets can help users understand and comply with their obligations and also respond to those who evade them.

“We can also expect further consultations ‘in the coming months’ aimed at tackling abuse of insolvency processes and missing trade fraud in construction."

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For further information please contact:

Alastair Henry, Citypress (on behalf of KPMG)

T: +44 (0)161 235 0320

M: +44 (0) 7738 206 847 

E: alastair.henry@kpmg.co.uk

KPMG Press office

T:  +44 (0) 207 694 8773

About KPMG in the UK

KPMG LLP, a UK limited liability partnership, operates from 22 offices across the UK with approximately 14,500 partners and staff.  The UK firm recorded a revenue of £2.2 billion in the year ended 30 September 2017. KPMG is a global network of professional firms providing Audit, Tax, and Advisory services. It operates in 152 countries and has 189,000 professionals working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity.  Each KPMG firm is a legally distinct and separate entity and describes itself as such. 

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