Did We Speak Too Soon? HMRC Admits it Wants to Know More About You!

In an earlier article we cut the UK some slack when comparing it to the US and the reach that the latter nation’s taxation authority, the IRS, has over American citizens worldwide.  We suggested that Britain was not as harsh on its citizens in terms of forcing full disclosure upon them no matter where in the world they live.  But did we speak too soon?

In a recent interview a senior figure at HMRC admitted that the British taxation authorities do actually want to know more about you!  So how will this impact those Britons resident in the UK and those who vote against the nation’s high tax regime with their feet, and expatriate to live abroad?

In this report we’re going to take a closer look at what the Permanent Secretary for Tax, David Hartnett, has allegedly said about the exchange of tax information developments he wants to see become par for the course across the world and across all tax havens and international financial centres.  What’s more, we’ll examine what such developments could mean in terms of the erosion of personal freedom for Britons worldwide.

In an interview with BusinessIFC.com, Mr. Hartnett was invited to comment on his long-term goals and ambitions within the remit and scope of his role as Permanent Secretary for Tax.  He apparently advised that he does not feel that current developments in place, designed to ‘urge’ offshore financial centres and tax havens to reveal relevant taxation information where abuse or criminal activity is suspected, go far enough.

According to BusinessIFC.com’s reporting of the interview, Mr. Hartnett personally has ambitions to push forward towards the day when there are globally powers in place for national tax authorities such as HMRC to access key personal and private data about their taxpayers’ assets held in other jurisdictions directly and without formal request.

In other words it seems that Mr Hartnett foresees HMRC being in the position where it will be omnipotent – i.e., all knowing and all seeing – when it comes to a Briton’s financial position.  Now this is scary stuff – this is talk that leads one to think of the erosion of all layers and levels of personal privacy.  Again of course we come back to the oft argued point that if you have nothing to hide you have nothing to fear – but if all personal freedom and privacy is forsaken in this way, surely it’s a very slippery slope until we’re living in a world where our rights are eroded to the point at which we actually have none – or none that are worth anything.

You may feel that such a reaction is over the top – however we at Shelter Offshore are big on freedom and personal rights, and if the British taxman has the right to know everything about where you choose to bank, invest and save, what you choose to do with the cash you legitimately earn and pay tax upon, declare and are fully open about anyway, where will this depth of governmental interference end?

We fully appreciate that where taxation avoidance can be proven or where there is suspected criminal activity involving money laundering within an offshore financial centre for example, that there have to be powers and laws in place to encourage disclosure – but taking it as far as David Hartnett seems to imply he wants to is taking it too far. 

Finally, according to the reports about the interview that Mr. Hartnett had with BusinessIFC.com, he allegedly threatened that tax havens and offshore financial centres would only have a place going forward if they agreed to full and complete transparency without request: “such centres will be able to continue only if they are fully transparent.”  It is surely of deep and serious concern to us all that there are those in positions of such significant power who really do want to do away with all personal rights to privacy and freedom of choice…