The Government is today initiating a historic agreement with Switzerland to tackle offshore tax evasion in an effort to resolve the long-standing abuse of Swiss banking secrecy by those who seek to conceal the proceeds of tax evasion, this measure is expected to secure billions of pounds of unpaid tax for the UK exchequer starting from 2013.
Under the terms of the agreement, existing funds held by UK taxpayers in Switzerland will be subject to a significant one-off deduction of between 19% and 34% to settle past tax liabilities, leaving those who have already paid their taxes unaffected. As a gesture of good faith Swiss banks will make an up-front payment from Switzerland to Britain of CHF 500m.
From 2013, a new withholding tax of 48% on investment income and 27% on gains will ensure the effective future taxation of UK residents with funds in Swiss bank accounts. This will be accompanied by a new information sharing provision which will make it easier for HM Revenue and Customs to find out about Swiss accounts held by UK taxpayers. The new charges will not apply if the taxpayer authorises a full disclosure of their affairs to HMRC.
Source : http://nds.coi.gov.uk
The Treasury has today published an unaudited summary of the Whole of Government Accounts (WGA) for the year 2009-10. The Government made available the key balance sheet analysis contained in this summary to the Office for Budget Responsibility (OBR) to enhance their analysis of the sustainability of the public finances in their first ever Fiscal Sustainability Report, also published today.
This is the first ever set of publication of information for the whole of the public sector, covering over 1,500 public bodies, and has been 10 years in the making. The full, audited accounts will be published in the autumn and will be the most ambitious in scope produced in any country.
The publication of this summary represents a leap in the transparency of reporting the Government’s future liabilities. It represents a snapshot of the Government’s financial position on a commercial accounts basis. Its aim is to enable Parliament and the public better to understand and scrutinise how taxpayers’ money is spent.
While the new information it presents does not affect the fiscal position, the analysis it includes on, for example,Private Finance Initiative (PFI ) and public service pension liabilities makes clear the scale of the fiscal challenge the Government faced before the June 2010 Budget.
The Accounts show that the public service pension liabilities as of 09/10 were £1.1 trillion pounds.
They also show that PFI capital liabilities as of 09/10 were over £35 billion. The OBR’s assessment in their Fiscal Sustainability Report is that these liabilities relate to about 90 per cent of all operational PFI assets, which suggest the total capital liability was closer to £40billion. The difference arises due to the internationally recognised accountancy standards used in WGA.
The Government has issued a call for evidence as part of its consideration of the integration of the operation of the income tax and National Insurance contributions systems, announced at Budget 2011. This is a preliminary stage of consultation, and aims to build a strong evidence base on the burdens to employers of having to operate two different systems. Responses to this call for evidence will inform the Government’s proposals for reform, on which it will consult in the autumn.
The two systems are currently operated entirely separately and the Government believes that greater integration of the two has the potential to remove economic distortions, reduce burdens on business, and improve fairness for individual earners.
The call for evidence document poses 14 questions, the majority of which focus on the burdens employers and payroll professionals face in paying income tax and NICs through the Pay As You Earn system. For example, how much staff time and other resource is required to manage the systems, which aspects of the process currently work well and how often problems are encountered when calculating payments.