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Margaret Hodge says accountants to blame for tax avoidance

Chairman of the Commons public accounts committee Margaret Hodge would like to see accountants and tax advisers held responsible for tax avoidance in the UK.

So the tax avoidance industry generates something like £2 billion in unpaid taxes a year or something. At least that’s what Hodge says. Then again she also says she’d like to see lawyers and contractor accountant firms are making vast sums of cash off of the wealthy more or less run out of business. These law firms and accountancy firms are all doing their level best to make as much money as they can by advising the rich to ferret their money overseas, supposedly safe from the grasping hands of Her Majesty’s Revenue & Customs, and Hodge – like many of us – has simply had it.

The best way to nip tax avoidance in the bud, Hodge says, is to not just punish those greedy bastards that put their money into places where the taxman can’t get to them. In fact, she really, truly wants to see anyone who promotes, sells or designs these schemes raked over the hot coals as well.

For what it’s worth, I’m more than leaning towards agreeing with the former Liberal minister. Right now the total tax gap is something close to £34 billion, and that’s a massive amount of cash to not be collecting even though it’s owed to the Government. Some of that missing cash ends up being ferreted away by tax avoidance schemes, others through any number of means, but it’s too big a deficit to make up without going after people who have been skimming off the top for years or even decades.

So what should we do? What can we do, besides trying to close these tax loopholes that we’ve got? Policymakers are reticent to do that because multinationals regularly threaten to pull up tent stakes and leave if the regulatory environment gets too hot for it, yet something has to be done at this point. Honestly, I say we bite the bullet and close these loopholes – and then make overseas tax evasion absolutely 100 per cent illegal – in order to ensure that nobody can take advantage of the system any more or ever again. Sure so some of those multinational deadbeats like Starbucks decide to relocate to a country that has more permissive tax law.

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