Andrew Allison is Campaign Manager for the Freedom Association.
George Osborne’s recent announcement that he plans to make it a criminal offence for Britons to hold undeclared income overseas marks a sea change in the power of the state over its citizens. Instead of HMRC proving that someone is guilty of tax evasion, the onus is now on the individual to prove they are not acting illegally.
In the wake of the announcement, Andrew Tyrie, Chairman of the Treasury Select Committee, voiced his concerns. Speaking to the Financial Times, he said that MPs would take “further evidence on the extension of HMRC’s powers”, including the moves to tackle offshore evasion and a right to dip into taxpayers’ bank accounts to recover unpaid tax. He went on to say:
“We must be vigilant to ensure we don’t lose the essential balance between the powers that HMRC needs and protecting individuals. Parliament needs to pay attention when these powers are extended.”
Parliament certainly does. We all should have the freedom to do what we see fit with our money. It is our money and does not belong to the Government. Tax evasion is, of course, illegal, and I am not condoning that. However, under these new plans, those who have paid tax on their income and have chosen to place some of their savings overseas could be regarded as easy prey for HMRC. They could easily feel forced into handing over more than they should as HMRC pursues them. Give HMRC more power, and it will use it. That’s as sure as night follows day.
With just over a year to go until a general election, there is a danger that politicians, whatever their political colours, will ride the populist wave, without fully thinking through their plans. With very little legislative time available in the next session of Parliament, there is also a danger that the Government will try and force through small bills that could have a profound impact on freedom.
The ban on smoking in cars when children are passengers is already on the statute book. This is unworkable legislation and very hard to police, but is it going to end there? The logical conclusion is to extend the ban to people’s homes. Are there going to be more anti-smoking bills?
Already the Welsh Government wants to ban e-cigarettes in public places – not based on evidence, but based on non-scientific reasoning that children will want to light-up if they see an adult in a cafe or restaurant using an e-cigarette. Just as it is popular to attack those who are “not paying their fair share of tax” (even though no-one can agree what a fair share is supposed to be), smokers, and those trying to give up smoking by using e-cigarettes, are easy meat.
Andrew Tyrie and the Treasury Select Committee are right to hold evidence sessions and give the Chancellor’s proposals proper scrutiny. By all means pursue those who are deliberately evading paying the taxes they owe, but do not shift the burden of proof from the government to the individual. This is yet another example of the government overreaching itself in the battle for votes as elections approach.