Tax cheats who owe the Exchequer more then £25,000 are to be named, shamed and blacklisted by the Government in a further bid to crack down on tax evasion.
As part of a package of measures to clamp down on tax avoidance and evasion, HMRC will publish a backlist comprising both companies and individuals who have "deliberately understated more than £25,000 of tax," according to the Budget Report.
Furthermore, HMRC will establish a statutory requirement for senior accounting officers of major corporations to personally certify that adequate controls to prepare tax computations are in place.
The Revenue will insist small businesses and serial individual defaulters of amounts over £5,000 provide more information about their tax affairs for up to five years. This should ensure they have the proper systems to be able to make a correct tax return.
To avoid being blacklisted, companies and businesses alike will be given the opportunity to voluntarily disclose any tax owed and pay up under the second Offshore Disclosure Facility (ODF) which runs until March 2010.
Ireland has used a similar scheme of naming and shaming since the 1980s and Darling reportedly believes it could raise millions of much-needed revenue from evaders reluctant to have their details disclosed.
In addition, HMRC will shortly issue a draft code of practice on taxation for the banking sector, plus a consultation document.
Disclosure of Tax Avoidance Schemes (DOTAS) is a vital part of the tax framework which provides HMRC with early warning of avoidance schemes.
DOTAS has already effectively countered over £11bn in avoidance opportunities since its introduction in 2004.
The Budget proposals bolster the Government's stance displayed at the G20 summit when it called on all countries to adopt the international standard for tax information exchange, and crack down on tax evasion between jurisdictions.
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