Tax avoidance concerns have been raised following the biggest document leak to date.
The ‘Pandora Papers’ include 12 million documents revealing offshore deals and investments of current and former world leaders, politicians, business leaders, and celebrities who have used tax avoidance schemes to hide their wealth.
A number of high-profile individuals are included in the document leak which includes 6.4 million documents, nearly 3 million images, more than 1 million emails and, almost 500,000 spreadsheets.
Similar papers have been leaked in the past however, the ‘Pandora Papers’ 12 million documents comprise from 14 corporations, which has taken a year for 600 journalists to sort through.
The data was obtained in Washington DC by the International Consortium of Investigative Journalists (ICIJ) which has been working alongside 140 media organisations.
It is reported that the Guardian and BBC Panorama have led the investigation in the UK.
Statement from the Chancellor
In an interview with the BBC, Chancellor Rishi Sunak said “My understanding is we carry out compliance checks in line with the referendums and political parties’ legislation that was put in place by the Labour Government. Those are the checks that are required by law, those are the compliance checks that the party carries out.”
HMRC has confirmed the Chancellor’s statement telling Accountancy Daily “What the Chancellor said stands”.
HMRC has been successful in the past in similar instances. The work on the ‘Panama Papers’ (a document leak in 2016) has recovered around £190 million from unpaid tax.
What is tax avoidance?
Tax avoidance is a deliberate attempt to get out of paying tax by entering into a set of artificial financial arrangements. These arrangements typically exist for no other purpose than to gain a tax advantage and reduce a tax bill.
HMRC’s full explanation of tax avoidance can be found here.
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