New tax raid on the wealthy?
The Treasury has vowed to clamp down on tax avoidance by the wealthy with the recruitment of 2,250 tax inspectors to target the country’s wealthiest people.
Speaking at the Liberal Democrat annual conference inBirmingham, chief secretary to the Treasury Danny Alexander said the government would ensure the 350,000 wealthiest people in theUKpaid their ‘fair share’ of tax.
‘We need to make sure tax owed is tax paid,’ said Alexander.
The extra staff will join a special unit within HM Revenue & Customs which scrutinises the tax arrangements of the richest 5,000 people in the country. The department’s remit will now be expanded to look at an additional 350,000 people who have a total wealth of more than £2.5 million.
‘It took 12 years for the previous government to take action against the wealthiest 5,000 people, some of who weren’t paying their fair share of tax,’ he said.
‘We can do better than that. My message to the small minority who don’t pay what they owe is simply. I agree with the chancellor. We will find you and your money and you will pay your fair share.’
The harsh words on tax avoidance were in contrast to Lib Dem leader Nick Clegg’s signal that he was willing to back down on the 50p tax rate for the wealthy.
Clegg has been a supporter of the Labour-introduced income tax rate for people earning over £150,000 but at the conference he signalled that the party would be willing to stand behind the abolition of the rate if more was done to help those on low incomes.
‘It stays unless we can make progress on lowering the tax burden on people on low incomes and secondly making sure, as the chancellor himself has said, we can find other ways that the wealthiest can pay their fair share.’
Lib Dem party president Tim Farron waded into the debate on the 50% tax rate, he said it would be ‘morally repugnant’ to bow to pressure to abolish the rate.
‘Are we all in this together? Well not if we give tax cuts to the rich. At a time when 90% of the country is struggling to pay the rent or the mortgage, giving a 1p tax cut to those who need it the least would not just be economically witless, it would be morally repugnant,’ said Farron.
In our opionion tax should always be considered as a cost and regular reviews of your tax position with an experienced financial planner is essential in order to mitigate as much tax as possible