18 Jul Proposed New Measures to Give HMRC Investigators Unprecedented Powers
HMRC has requested new powers that would give it access to taxpayers’ bank accounts without prior permission.
According to Economia, the tax office says the new powers would help keep it competitive in its effort to crack down on tax evasion and avoidance.
But the Institute of Chartered Accountants for England and Wales (ICAEW) says the measures would amount to a “very significant change”.
Under current rules, HMRC must first seek tribunal approval before it can access banks and financial institutions, as well as lawyers and accountants’ records.
To do so, it must demonstrate that the information is “reasonably required” and meets the criteria of Schedule 36.
However, if the new rules were to be passed, HMRC would be able to investigate taxpayers in secret and without prior approval from the courts.
The tax office says safeguards will be considered to “ensure its powers remain proportional and appropriate”, but the extent it will use them is unknown.
An HMRC spokesperson said: “In many cases, this information is obtained voluntarily from the taxpayer.
“However, on occasion, HMRC needs to use its formal powers to obtain relevant information.
“Sometimes the information is held by a third party rather than the taxpayer (for example, the taxpayer’s bank).
“Third parties, in particular, may also require the use of a formal power as data security and other rules may prevent them voluntarily supplying information.”
The proposals have faced fierce opposition, with some commentators calling the measures “shocking” and would “undermine fundamental freedoms”.
The consultation is open now, with members of the public able to voice their opinions until 02 October 2018.