Bidding ban for tax avoidance firms

tax dodgeCompanies found guilty of aggressive tax avoidance will be banned from bidding for major Government contracts, under new rules published by the Treasury.

The rules will require all firms and individuals bidding for contracts to declare whether their tax returns have been rejected because of involvement in a tax avoidance scheme.%VIRTUAL-SkimlinksPromo%

And firms will also have to sign a clause in contracts allowing departments to terminate the agreement if they are later found to have breached tax compliance obligations.

Announcing the plans in a written statement to Parliament, Chief Secretary to the Treasury Danny Alexander described the changes - due to come into effect on April 1 - as "another significant tool (which) will provide a framework to enable Government departments to say no to firms bidding for Government contracts where they have been involved in failed tax avoidance".

Under the new regime, suppliers bidding for contracts will be required to inform Government departments if any tax return has recently been found to be incorrect as a result of an HM Revenue and Customs challenge under anti-avoidance and anti-abuse rules or due to involvement in a failed avoidance scheme.

Successful bidders will be contractually obliged to tell departments if they are found in breach of tax obligations after winning a contract.

The move comes after massive controversy over the tax affairs of major multinational companies like Starbucks, Amazon and Google, though there is no suggestion that these firms would fall foul of the new arrangements.

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HMRC's biggest tax cheats of 2012
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Bidding ban for tax avoidance firms

Jailed for evading over £4.5 million in VAT due on platinum trading.

Jailed for evading over £4.5 million in VAT due on platinum trading.

A gang which described over 20 million smuggled cigarettes on shipping documents as babies’ toys was jailed after a covert surveillance operation.

Sentenced in 2012: Phillip William Robinson, Vincent Waller, Phillip William Hall, Christopher John Burns and Andrius Kochanauskas – 13 years 1 month

A gang which described over 20 million smuggled cigarettes on shipping documents as babies’ toys was jailed after a covert surveillance operation.

Sentencing: Paul O’Meara, Robert Doran, Patrick Gray, Martin Cleland, Mark Sadgrove, Wayne Stock and Matthew Neale – 24 years 6 months

A gang which described over 20 million smuggled cigarettes on shipping documents as babies’ toys was jailed after a covert surveillance operation.

Sentencing: Paul O’Meara, Robert Doran, Patrick Gray, Martin Cleland, Mark Sadgrove, Wayne Stock and Matthew Neale – 24 years 6 months

Part of a criminal gang which set up a factory capable of making up to 625 million counterfeit cigarettes and five million pouches of fake hand rolling tobacco a year.

Part of a criminal gang which set up a factory capable of making up to 625 million counterfeit cigarettes and five million pouches of fake hand rolling tobacco a year.

Part of a criminal gang which set up a factory capable of making up to 625 million counterfeit cigarettes and five million pouches of fake hand rolling tobacco a year.

The gang set up a chain of bogus companies to trade fraudulently in EU emissions allowances.

Sentenced in 2012: Sandeep Singh Dosanjh, Navdeep Singh Gill and Ranjot Singh Chahal – 35 years

The gang set up a chain of bogus companies to trade fraudulently in EU emissions allowances.

Sentenced in 2012: Sandeep Singh Dosanjh, Navdeep Singh Gill and Ranjot Singh Chahal – 35 years

Roy Faichney, Managing Director of Vantis Tax Ltd, was sentenced to four years for his part in a fraudulent tax avoidance scheme which left charities and Exchequer out of pocket.

The gang claimed to have sold four million mobile phones worth £1.7 billion. However, in many cases the phones did not exist. In an attempt to make the trade appear legitimate, over 5,700 fake business transactions were created to claim large amounts of VAT.

Sentenced in 2012: Lee Sellers, Mehmood Khan Nazir, Umar Khan Nazir and Marshall Boston – 10 years 6 months

The gang claimed to have sold four million mobile phones worth £1.7 billion. However, in many cases the phones did not exist. In an attempt to make the trade appear legitimate, over 5,700 fake business transactions were created to claim large amounts of VAT.

Sentenced in 2012: Lee Sellers, Mehmood Khan Nazir, Umar Khan Nazir and Marshall Boston – 10 years 6 months

HMRC

The gang claimed to have sold four million mobile phones worth £1.7 billion. However, in many cases the phones did not exist. In an attempt to make the trade appear legitimate, over 5,700 fake business transactions were created to claim large amounts of VAT.

Sentenced in 2012: Lee Sellers, Mehmood Khan Nazir, Umar Khan Nazir and Marshall Boston – 10 years 6 monthsgang claimed to have sold four million mobile phones worth £1.7 billion. However, in many cases the phones did not exist. In an attempt to make the trade appear legitimate, over 5,700 fake business transactions were created to claim large amounts of VAT.

Sentenced in 2012: Lee Sellers, Mehmood Khan Nazir, Umar Khan Nazir and Marshall Boston – 10 years 6 monthse gang claimed to have sold four million mobile phones worth £1.7 billion. However, in many cases the phones did not exist. In an attempt to make the trade appear legitimate, over 5,700 fake business transactions were created to claim large amounts of VAT.

Sentenced in 2012: Lee Sellers, Mehmood Khan Nazir, Umar Khan Nazir and Marshall Boston – 10 years 6 months

Sentenced in 2012: Lee Sellers, Mehmood Khan Nazir, Umar Khan Nazir and Marshall Boston – 10 years 6 months

A criminal gang has been jailed for one of the biggest ever alcohol smuggling frauds ever uncovered in the UK. The scam was worth £50m a year in unpaid duty and VAT.

Sentenced in 2012: Kevin Ramon Burrage, Gary Dennis Clarke, Michael Brian Turner and Davinder Singh Dhaliwal – 21 years 3 months

A criminal gang has been jailed for one of the biggest ever alcohol smuggling frauds ever uncovered in the UK. The scam was worth £50m a year in unpaid duty and VAT.

Sentenced in 2012: Kevin Ramon Burrage, Gary Dennis Clarke, Michael Brian Turner and Davinder Singh Dhaliwal – 21 years 3 months

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