The curtain may be drawn back on the ultra secret banking affairs of thousands of expats sheltering their cash in Liechtenstein.
The tiny principality lodged in the Alps between Austria and Switzerland, is considering signing up to tax amnesties with more countries after a disclosure agreement with the UK has led to 2,400 people volunteering information about unpaid tax.
HM Revenue & Customs reckons the disclosure will raise around £3 billion in ‘lost’ tax by 2016.
Other countries have keenly observed how the disclosure has progressed and want their slice of the tax pie.
“We are in discussion with a number of countries on such an approach,” Katja Gey, the director of international financial affairs for Liechtenstein, said in a telephone interview. “There has been interest, but so far we have not come close to a possible conclusion of a similar treaty.”
The pressure is on smaller nations considered ‘tax havens’ by the leading developed countries in the Organisation of Economic Cooperation and Development (OECD).
The OECD has run a campaign to encourage investors in tax havens to come clean about their tax affairs in return for favourable treatment – or face possible criminal prosecution and stiffer penalties when amnesties end.
Meanwhile, around 400,000 callers have passed information to a HMRC tax evasion hotline during the past five years.
More than 74,000 calls were made in 2011, which was a decrease of nearly 9% from 2010, which adds up to a call every five minutes on every working day.
HMRC is also running special task forces to investigate taxpayers with overseas investments and those running specific businesses, like the catering trade, the motor trade and buy to let property investment.
Launching the latest task forces looking at pubs, restaurants, clubs and car dealers, the Exchequer Secretary to the Treasury, David Gauke, said: “At a time when we are trying to rebalance the public finances and most hard-working people are making a contribution by paying the right tax, it is just not fair that a small minority try to dodge their responsibilities.”
