Avoiders of tax won’t get honours

Wales On Sunday - - NEWS -

TAX avoiders face be­ing shunned for honours such as knight­hoods, as au­thor­i­ties clamp down on re­ward­ing those with “poor” fi­nan­cial be­hav­iour.

HM Rev­enue and Cus­toms (HMRC) has been alert­ing the Cab­i­net Of­fice to in­di­vid­u­als in­volved in con­tro­ver­sial tax schemes, with a mem­o­ran­dum of un­der­stand­ing ob­tained by The Times say­ing “poor tax be­hav­iour is not con­sis­tent with the award of an hon­our”.

A doc­u­ment pub­lished on the Gov.uk web­site said the vet­ting process sees HMRC as­sign a low, medium, or high-risk rat­ing to prospec­tive nom­i­nees “to min­imise the risk that prospec­tive can­di­dates have be­haved in ways likely to bring the sys­tem into dis­re­pute”.

The Times said medium risk in­cludes those whose tax af­fairs would be “likely to cause ad­verse com­ment”, such as “par­tic­i­pat­ing in ... avoid­ance schemes”.

Red warn­ings are as­signed to those on the HMRC’s Man­ag­ing Se­ri­ous De­fault­ers Pro­gramme, along with those in­volved in “off­shore eva­sion”, the re­port claimed.

The memo is re­ported to have said: “Trust would likely be lost if an hon­our was awarded to some­one with neg­a­tive tax be­hav­iours.

A time limit of three years is said to be in place, mean­ing can­di­dates can be cleared to re­ceive an hon­our if they have aban­doned avoid­ance schemes.

In­di­vid­u­als can be nom­i­nated who use “per­sonal ser­vice com­pa­nies” or if they do “ac­cept­able tax plan­ning”, it is re­ported.

A govern­ment spokes­woman said: “Honours are given to re­ward out­stand­ing ser­vice in a given field or area and each nom­i­na­tion is rig­or­ously as­sessed.”

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