THE Government’s coffers will be bolstered thanks to fresh crackdowns on tax dodging, according to the Chancellor.
Nearly £4 billion is expected to be raised over the next four years by extending rules that force people to pay tax debts immediately after avoidance schemes are found to be unlawful.
Previously individuals could delay settling bills until after the conclusion of legal appeals – meaning they effectively had a tax-free loan from the public purse. Aides to Mr Osborne said the change would affect 33,000 people earning an average of £262,000 a year.
It is hoped that insisting on up-front payment will remove the incentive for people to invest in complex tax avoidance vehicles even after they have been ruled invalid.
Another high-profile move will see the punitive 15 per cent stamp duty rate on houses bought through shell companies widened. It will now apply to all residential properties worth more than £500,000, rather than the £2 million before. However, that is only expected to bring in £365 million for the Exchequer by 2018-19.
HM Revenue & Customs will also get stronger powers to recover tax and tax credit debts directly from people’s banks and building societies. They will target those owing more than £1,000 and leave individuals at least £5,000 in reserve. The action is predicted to raise £365 million over four years. Mr Osborne said public tolerance for those who do not pay their fair share had evaporated long ago.