Danny Alexander calls for corporate tax evasion crackdown

COMPANIES that fail to prevent tax evasion could face penalties as part of plans announced by Danny Alexander.

The Liberal Democrat chief secretary to the treasury aims to introduce a new offence for firms that fail to act to prevent economic crime.

Mr Alexander told the Andrew Marr show he wants organisations that encourage or facilitate tax evasion to face the same penalties as evaders themselves.

The proposed crackdown comes in the wake of HSBC tax-dodging allegations.

Mr Alexander said: “We should create a new offence of corporate failure to avoid preventing an economic crime and also that organisations who facilitate or encourage evasion should face the same penalty as the evaders themselves.”

He described it as a “Liberal Democrat idea” but intends to try to push the proposals through before May’s general election.

If he cannot, they will form a key part of the Lib Dem manifesto.

“Organisations, be they accountants, banks or whatever, who help people evade tax will be liable for this new offence and crucially liable for financial penalties,” he added.

“So, for example, if their customers have to pay back hundreds of millions of pounds in tax then those organisations should have to match that with hundreds of millions of pounds of their own money and I think that’s a very tough disincentive to them to get involved in this in the first place.

“This is taboo. This is something that absolutely mustn’t happen in our society and we still have a problem with some people thinking they can get away without paying their fair share of tax.”

The Lib Dems said they would make a commitment to see the “tax gap” – the difference between the total owed to the Exchequer and the amount collected – fall in each year of the next parliament.

The party would also strengthen codes of practice which apply to tax-advising professions.

Mr Alexander said in a statement that “these cheats and their accomplices are effectively stealing from all of us”, adding: “These new measures will build on the successful strategy that is making tax evasion as socially unacceptable as benefit fiddling or drinking and driving.”

His comments come after it was alleged that HSBC had helped hundreds of people evade UK tax using hidden accounts in Switzerland.

The Financial Conduct Authority is among regulators probing the claims.