The tax avoidance schemes that attracted comedian Jimmy Carr and the band Take That are only the "tip of the iceberg" in the hunt to recover Britain's uncollected taxes.
HM Revenue & Customs (HMRC) told The Independent yesterday that the "K2" and "Icebreaker" schemes, along with other tax "management" plans were regarded as loopholes that were "fairly public and on the radar" of tax inspectors. Such schemes attracted the wealth of celebrities including the TV presenter Gabby Logan, the former England football manager, Terry Venables, and the Olympic medallist, Colin Jackson, pictured. But since an additional £917m was allocated to HMRC in 2010 to specifically tackle tax avoidance, new teams of specialist investigators operating like intelligence cells, have targeted high-value under-the-radar schemes that are believed to hide billions of pounds in lost tax.
The HMRC estimates the current loss related to uncollected tax involving individuals, as opposed to companies, is £5bn. The recent investigation by The Times newspaper claims that 94 schemes, where £2.2 bn is invested, are being looked at by HMRC. However, if these schemes are eventually dismantled the money recovered would only net UK tax authorities a fraction of what remains hidden.
HMRC sources believe the public profile that Mr Carr and others have brought to legal tax loopholes, may force those determined to cut their tax bills to find schemes that shady tax advisers will claim have escaped the tax net for years. Mr Carr's involvement in the K2 scheme, which was attacked by David Cameron as "morally wrong", are regarded by some advisers as "mass market deals open to any Tom, Dick and Harry".
One leading accountancy firm said the exposure which has followed the Prime Minister's comments "could see an explosion in the under-the-counter evasion schemes available to the super-wealthy."
Tax and tax reduction plans, which until this week were a common subject of commercial gossip, have quickly become a taboo topic.
Yesterday in a private meeting of the London Chamber of Commerce, where the Conservative Party vice-chairman, Michael Fallon, was answering questions from a select group of leading businessmen, there was discussion on rebuilding the economy, on planned government reforms, education and welfare.
One senior member said "It was what was not discussed this time that was eerily uncomfortable. Anything that's making headlines is always talked about. But there was silence on tax – absolutely nothing. It was the large elephant in our small room."
The former Liberal Democrat finance spokesman, Lord Oakeshott, said the Prime Minister has stuck a dagger into the heart of leading donors to the Tory Party who enjoy non-dom status.Reuse content