Government announces criminal liability for firms allowing employees to facilitate tax evasion

The Government has announced a new legislation to hold firms criminally liable if they fail to stop employees who facilitate tax cheating

David Cameron announced on 11 April 2016 that new laws will be made this year to hold employers accountable where they have failed to prevent employees from facilitating tax evasion.

The Prime Minister said: “This Government has done more than any other to take action against corruption in all its forms, but we will go further.

“That is why we will legislate this year to hold companies who fail to stop their employees facilitating tax evasion criminally liable.”

The new legislation announcement comes ahead of the London anti-corruption summit being hosted by the Government on 12 May 2016.

The summit is “aimed at stepping up global action to expose, punish and drive out corruption in all walks of life”.

Employment law editor at XpertHR, Bar Huberman said: “Further details of the new offence are awaited. Will there be guidance on what procedures organisations will be expected to put in place to raise awareness of tax evasion, and what penalty will be set for companies that fall foul of the law?”

“Organisations may need to step up their procedures to ensure that attempts to avoid tax are spotted early.”

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