A Norfolk MP has said the government must transform UK taxes to prevent avoidance schemes like that which saw comedian Jimmy Carr paying as little as 1pc of his income into Treasury coffers.

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South Norfolk MP Richard Bacon, who sits on Parliament’s Public Accounts Committee, made his call as the group published a report yesterday into tax avoidance.

Aggressive avoidance scheme promoters were “running rings” around HM Revenue and Customs, the committee’s report said.

Meanwhile, it warned that the taxman was losing the “game of cat and mouse” as tax consultants took advantage of the time it took officials to shut down a particular avoidance method to make money.

Mr Bacon argued the only way to fundamentally address the problem was to massively simplify the tax system.

He said: “The problem is that previously it’s been thought that by adding several hundred extra pages to tax regulation each year you could solve the issue.

“But all you are actually doing is giving more work to lawyers and tax consultants to find more loopholes.

“We need to make the entire system much simpler. That’s the only way to get ahead of the big companies in this game, and it’s going to take political will.”

Last year comedian Jimmy Carr admitted to making a “terrible error of judgment” after it emerged he used a complex scheme to reduce his tax bill.

Meanwhile the committee’s chair Margaret Hodge said: “We have seen how public anger and consumer pressure can influence large companies, such as Starbucks, to behave more responsibly.

“HMRC should publicly name and shame those who sell or use tax avoidance schemes in order to discourage such activity.

“With at least £5 billion lost to tax avoidance each year, HMRC has got to get much more robust in its approach.”

11 comments

  • RB is squeaky clean I'll have you know. And he likes nothing more than talking tough on tax cheats. RB has carved a political career for himself by saying the right things about tax. Meanwhile the Chief executive of the Student Loans Company was allowed to avoid £40,000 a year in income tax under an a-la-Carr deal approved by the Coalition Government. RB must have been so disappointed. In fact it’s a matter of public record that he contacted the Cameleon to express his concern. How many other tax dodgers are being aided and abetted by the ConDems? It must be so annoying for RB to have all his hard work in committee undermined by careless ministers. RB was probably also annoyed in 2009 when some little oik from Diss dissed his expense claims “On top of his salary, I feel 147,498 of expenses per year is an incredible price to pay for an MP, especially at a time when so many people have so little”. Incredible insight from one so young. But RB bounced back, stating that the bulk of the 147,498 was used to pay for staff and office costs in Diss. Blimey, you could have got somewhere in Mayfair for that!

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    Mr Cameron Isaliar

    Wednesday, February 20, 2013

  • Could someone look into the tax affairs of Bacon and his family?

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    Police Commissioner ???

    Tuesday, February 19, 2013

  • Registering companies in Switzerland, Luxembourg or Jersey and paying very little tax in those countries is enabling companies to bring their much higher profits into the UK without being taxed further. That was introduced by this minority party coalition, reverse it. Multinationals who want to sell here, should pay taxes here and show a socially responsible attitude to operating here. They can't all be making large returns, but should look at long term, sustainable trading and smaller profits.

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    ingo wagenknecht

    Tuesday, February 19, 2013

  • Wan to see more on how MPs do it? 3-2-commetdotbogdotcodotuk

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    Mr Cameron Isaliar

    Tuesday, February 19, 2013

  • Wayne Kerr: you seem to have got it about right. I would disagree that 'most people don't mind paying tax...' because I think they do, on the grounds that they cannot stomach the amount of waste in Whitehall. Every one of us would prefer to pay the least tax - anyone who says otherwise is deluded. But of course, when it is someone ELSE who has found a legal way to minimise the tax they pay they are dubbed 'immoral' !! One rule for me and one for everyone else. Hypocritical. Simplify the system so that there is no way round it...

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    Patrick

    Thursday, February 21, 2013

  • If tax rates & regulations were set at reasonable levels most people wouldn't bother trying to avoid paying - it wouldn't be worth the time & effort. Tax revenues would actually increase & there would be minimal cost to the revenue (taxpayer) as fewer try to dodge. Most people don't mind paying tax - it's the criminal amount of waste & fiscal ineptitude of successive governments that infuriates!

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    Tudor Bushe

    Tuesday, February 19, 2013

  • Perhaps Mr Bacon can start by looking into the financial affairs of George Osborne, resident of 11 Downing Street. Current salary £134,565, plus an annual six figure income from the rent of his £3million Notting Hill house and a 15% stake in a business estimated to be worth £4million. Mr Osborne claims he is not wealthy enough to pay top rate tax. If that is not "avoidance" what is it?

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    MediaDoc

    Tuesday, February 19, 2013

  • Bang on, we don't like JC, heard he is a bit of a lefty, you know, why else would he have fed the 5,000 when the priority should have been to focus on the exec and management teams. Oh sorry, wrong JC. The JC in question, ah yes, did he benefit from the same scheme as that used by a recently-revived boy band, now more a rapidly-approaching-middle-aged-spread band? Funny they didn't get the same attention, although I understand the extent of the stash from their come-back tour was some ten times greater than JC's little pot. Could that be because the frontman is one of DC's celeb mates, out with the now PM on the 2010 campaign trail to woo those northern voter types with some bizarre promise of a singing competition for schools based on the “ex-factor”, whatever that is. Anyway, isn’t good to see the press focussing on the most serious culprits. In fact, when challenged about his mate’s misdeed, DC refused to criticise him over the alleged use of a tax avoidance scheme. He said he was not going to give a "running commentary" on people's tax affairs - but he had made an exception for JC because "it was a particularly egregious example of an avoidance scheme that seemed to me to be wrong (because he’s a lefty you know)".

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    Mr Cameron Isaliar

    Tuesday, February 19, 2013

  • How was it possible that two thirds of the QE cash ended up in off shore tax havens, as 'collateral', money for old rope? The whole of the cabinet are millionaires, newbies devout of any reality, never had to work for their living. The distinction between avoidance and evasion were always blurred, hence the vast sums bypassing the exchequer, its not working people who try and avoid taxes, its those we call responsible and enterprising that are failing in their duty to society.

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    ingo wagenknecht

    Tuesday, February 19, 2013

  • Animal Farm.

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    Mad Brewer

    Thursday, February 21, 2013

  • Regrettably avoidance is not illegal, evasion is. If Bacon wants to come down on avoidance schemes he needs to make avoidance illegal but I don't quite know how he will do that because for every scheme they make illegal another avoidance scheme will pop up. One avoidance scheme I would like to see slapped down hard is that where monies made in this country on our high streets and from people who live here buying on the internet from here (step forward Amazon and Starbucks for a kickoff) They should be prevented from taking even one penny out of this country. And don't tell me they will take their business elsewhere - where do you think the business is done? What they going to do? Take us all with them to continue buying their goods?

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    Electra

    Tuesday, February 19, 2013

The views expressed in the above comments do not necessarily reflect the views of this site

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