44% Rise in Requests from Foreign Prosecutors to UK for Help Investigating Tax Crimes

 There has been a 44% rise in the number of information requests from foreign prosecutors to the UK for help with criminal tax investigations, says Thomson Reuters.

The number of information requests related to tax offences committed by corporates or individuals sent to the UK reached 148 in 2018, up from 103 in 2017. These requests to the UK Government require businesses or individuals to provide documents; such as transaction histories or bank statements, within a certain time period, or even give evidence in court.

This rise in requests reflects the growing cooperation between international law enforcement agencies in tackling tax evasion. Tax evasion has climbed high on the agenda for governments following considerable public and media scrutiny in recent years.

There are several international taskforces designed to help governments reduce tax evasion, including the Joint International Taskforce on Shared Intelligence & Collaboration, which is a global network of over 40 countries that collaborate on ways to identify and combat evasion.

Tax offences have also become increasingly sophisticated and cross-border in nature, which makes it harder for individual law enforcement agencies to gather the evidence needed to prosecute a case.

Brian Peccarelli, chief operating officer, Customer Segments at Thomson Reuters, says: “Tax authorities globally are increasingly working together to stamp out tax evasion.

“Deeply integrated economies and lengthy supply chains mean investigating tax offences can be very difficult without collaboration. Information sharing networks can therefore be very important in increasing the chances of locating the offenders.”  

OECD unveils new proposals for corporate tax reform

The Organisation for Economic Cooperation & Development recently unveiled its new proposals aimed at reducing corporate tax avoidance and evasion. The proposals would see an increase in the rights of countries to levy tax on corporate income earned from sales in their jurisdictions, regardless of which jurisdiction those profits are actually recorded in.

Brian Peccarelli adds: “The rise of digital business models means value can be created in jurisdictions where a business has limited or no physical presence.”

In addition to the information sharing frameworks for criminal tax investigations, many countries also share information on non-criminal tax issues through ‘double taxation treaties’. The treaties are designed to ensure individuals and businesses do not pay tax in two different jurisdictions.

Thomson Reuters

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