HM Revenue & Customs’ (HMRC) plan to make undeclared taxable offshore income a criminal offence has suffered a blow as it has been omitted from draft legislation.
The draft Financial Bill, published earlier this week, extended the scope of civil penalties for tax evasion but there was no reference to making failure to declare taxable offshore income and gains a criminal offence.
In August HMRC said it was looking to make tax evasion a criminal offence. Currently not declaring taxable offshore income and gains is a civil offence.
Ray McCann, partner at Pinsent Masons told the Financial Times: ‘I think that the proposal is now likely to quietly disappear. There is no substance to it.’
Instead the government is considering other measures, including enhancing financial incentives for those who provide information on offenders and extend the existing offshore penalty regime to inheritance tax and domestic offences.