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Accountants promoting tax avoidance chastised

Accountants promoting aggressive tax avoidance schemes have been publicly chastised by the chief executive of the largest accountancy body in the UK, despite the alienation it has caused with some of the industry body’s members.

The Institute of Chartered Accountants in England and Wales’ chief executive, Michael Izza, has had nothing but criticism for accountants who recommend such rigorous tax avoidance measures to their clients. Such schemes have become into the public eye after it became widely known that comedian Jimmy Carr has been using a tax avoidance measure known as K2 to funnel his earnings overseas.

The fact that the K2 scheme is technically legal does little to deter Mr Izza’s ire, remarking that those in the accountancy profession have a duty to eschew any obviously artificial tax dodges. The public has little patience with a legal loophole, the chief executive said, adding thataccountants cannot do anything that can bring disrepute to the profession.

While Mr Izza’s statements were praised by some ICAEW members, others have taken issue with the strong stance taken by the chief executive. It’s not an accountant’s place to make decisions for their clients, detractors say, and that tax professionals are only required to present a full range of options.

Prime minister David Cameron has also spoken out against the K2 scheme, calling out Mr Carr in particular by stating that it was ‘morally wrong’ of him to use the tax avoidance measures. Mr Carr has since ceased using the K2 scheme.

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