In the wake of the so-called Panama Papers scandal, HM Revenue & Customs (HMRC) has launched a consultation into tax laws for corporate businesses, in a bid to crack down on tax evasion.
HMRC has reviewed draft legislation published in December 2015 with plans to introduce a new ‘inadequate preventative measures’ offence, which will cover both UK and overseas tax evasion.
The taxman’s consultation document, which will run until 10 July, puts forward the argument that the current legislation demands too high a level of proof in Court to effectively charge companies and corporates for tax evasion carried out by themselves or their employees.
The new proposal hopes to change this by encouraging internal checks and increased reporting responsibilities.
Under the new legislation, it will be deemed an offence for any corporate to fail to take ‘adequate measures’ to prevent employees from either committing, or assisting in, tax evasion.
The news follows the recent controversy of the Panama Papers scandal, in which leaked information from law firm Mossack Fonseca revealed numerous offshore tax havens.