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UK signs Liechtenstein tax deal | |
(about 5 hours later) | |
The UK has signed a deal to recover lost tax from Britons holding bank accounts in Liechtenstein. | |
HM Revenue & Customs (HMRC) has agreed with the Alpine tax haven to start exchanging information. | HM Revenue & Customs (HMRC) has agreed with the Alpine tax haven to start exchanging information. |
Up to 5,000 British investors are thought to have an estimated £3bn in secret accounts in the country. | |
Investors will be offered the chance to volunteer details of their deposits in return for penalties, capped at 10% of tax evaded over the past 10 years. | |
HMRC said that those who failed to make a full disclosure would have their accounts closed down and risk losing all their savings. | |
"Those who have been evading UK tax on assets held in Liechtenstein banks must now settle with us. There are no alternatives," said HMRC permanent secretary for tax, Dave Hartnett. | |
Treasury minister Stephen Timms added that the agreement was "very good news for honest taxpayers and investors everywhere", saying it represented "a big step forward for tax transparency". | |
Pressure | |
Liechtenstein was once seen as one of the most secretive jurisdictions, favoured by the wealthy looking to shelter money from their own tax authorities. | |
However, it came under pressure last year after the German government obtained a list of wealthy Germans with money stashed away. | |
More generally, pressure has mounted on tax havens to share information since April's G20 Summit and similar deals have already been struck with the US and Germany. | |
Governments are particularly keen to trace and recover unpaid revenues as tax receipts fall in the global recession. | Governments are particularly keen to trace and recover unpaid revenues as tax receipts fall in the global recession. |
In April, the UK government launched a new push to squeeze millions of pounds in unpaid tax from people with offshore accounts. | |
It has already signed agreements with tax havens such as Jersey, Guernsey, Isle of Man, and the British Virgin Islands to allow the exchange of financial information on UK residents. | |
The Revenue's first campaign in 2007 raised £450m from 45,000 people. That targeted offshore accounts held by the UK's big High Street banks. |