Government guilty of two-faced approach to tax avoidance
A report by the All Party Parliamentary Group on Responsible Tax has criticised the Government for having a two-faced approach to tackling international tax avoidance. MPs said ministers privately pushed-back against proposals from the OECD for reform while publicly proclaiming their determination to tackle global tax avoidance. Committee chair Dame Margaret Hodge added that it was “frustrating” that the Government had failed to make overseas territories and crown dependencies follow Britain’s lead in publishing company beneficial ownership registers. “We need to open up the affairs of global companies to public account if we are to clean up the abuse that pervades so many international businesses,” she said. “The government should take a leading role and introduce public country-by-country reporting.” The report paid tribute to tax OECD experts but said the G20 and others needed to do more to combat aggressive tax planning by big business.
Rising house prices boost IHT receipts
HMRC collected £4.7bn in IHT in 2015/16 – a 22% increase on the previous tax year, when IHT receipts were £3.8bn. This was also the highest ever amount since the current tax system was introduced 30 years ago and almost double the 12% growth recorded the previous year, according to the figures by the ONS. Soaring house prices have dragged an increasing number of people into paying the tax, calculated at 40% of anything above £325,000 for individuals and £650,000 for couples. Critics argue that a tax initially intended to capture only the rich is now being paid by people who are not particularly wealthy but have seen their family home rise in value. The ONS said that the rise was also driven by a 6% increase in the number of deaths leading up to 2015-16 compared to the previous year.