In February 2012 it was revealed that the trusted big name banking company Barclays' had been evading tax in various ways, raking in at least 500 million for their troubles. The first way they managed to evade the dreaded tax was by reinvesting in some of their own debt. The bank raised funds by selling bonds for a set price, then when those bonds devalued it meant that the value became so low that Barclays were able to buy them back for less than the set price that they were originally sold for.
A study by the Bureau found a $102bn tax evasion market in European shares. The analysis has suggested that the tax loss of European countries is around 595m each year, and mainly affects France, Germany and Italy. It served as a wake-up call for chancellor of exchequer George Osborne, as British banks have been taking these kinds or risks and getting away with it for far too long already. Sir John Vickers' Independent Commission on Banking suggested "ring fencing banks' high street businesses from their 'casino' investment banking arms."
The second way in which Barclays' managed to evade tax was by using a loophole that allowed them to claim tax credits for tax-free income streams, essentially getting back money that was never paid out in the first place.
George Osborne's budget will see that these kind of loopholes being patched up to stop further tax evasion by big companies like Barclays', but when the story originally came out on Monday 27th February the Treasury announced the new rules were to be put in place immediately, and would cover tax evasion cases back to December 2011, meaning Barclay's would not get away scot-free. However, concerns were raised about the fact that the rules were too busy combating past issues, and not preventing them happening in future, with the shadow exchequer minister Owen Smith referring to the new legislation as 'a toothless tiger'.
Chief executive of consumer group Which? Peter Vicary-Smith stated how the percentages brought into light by the Financial Ombudsman Service is further evidence of the unfair management of consumer's cases by banks, especially when things don't go to plan. He also stated his feelings of disgust in regards to the large number of consumers forced to take their cases to the ombudsman.
A study by the Bureau found a $102bn tax evasion market in European shares. The analysis has suggested that the tax loss of European countries is around 595m each year, and mainly affects France, Germany and Italy. It served as a wake-up call for chancellor of exchequer George Osborne, as British banks have been taking these kinds or risks and getting away with it for far too long already. Sir John Vickers' Independent Commission on Banking suggested "ring fencing banks' high street businesses from their 'casino' investment banking arms."
The second way in which Barclays' managed to evade tax was by using a loophole that allowed them to claim tax credits for tax-free income streams, essentially getting back money that was never paid out in the first place.
George Osborne's budget will see that these kind of loopholes being patched up to stop further tax evasion by big companies like Barclays', but when the story originally came out on Monday 27th February the Treasury announced the new rules were to be put in place immediately, and would cover tax evasion cases back to December 2011, meaning Barclay's would not get away scot-free. However, concerns were raised about the fact that the rules were too busy combating past issues, and not preventing them happening in future, with the shadow exchequer minister Owen Smith referring to the new legislation as 'a toothless tiger'.
Chief executive of consumer group Which? Peter Vicary-Smith stated how the percentages brought into light by the Financial Ombudsman Service is further evidence of the unfair management of consumer's cases by banks, especially when things don't go to plan. He also stated his feelings of disgust in regards to the large number of consumers forced to take their cases to the ombudsman.
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