Jeff Salway: Cameron finds taking on the corporate dodgers too taxing

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DID you hear the one about the Kirkcaldy grocer, the Liverpool hairdresser and the Bolton coach operator?

The distinctly dry answer is that they were all on the first list of tax defaulters published by HM Revenue & Customs this week. It’s not funny – certainly not for the miscreants – and, frankly, it’s not as clever as the tax office thinks it is. It is pretty cynical, however.

HMRC believes that by outing “deliberate defaulters” it will deter more people from evading or avoiding tax. The revenue is “dedicated to taking action against tax cheats”, its press rel­ease warned, leaving us in no doubt that it means business.

The first list attracted plenty of attention, unfortunately for the nine individuals and businesses singled out, but the novelty will soon wear off.

Funnily enough, that’s what’s happening to the furore over multinational tax-dodgers. The outcry over the failure of organisations including Starbucks, Amazon and Google – what is it about Seattle companies? – to pay tax on their UK profits reached a crescendo before Christmas. Predictably, that has died down. So has the government’s rhetoric about tackling it.

David Cameron, right, and George Osborne have talked a good game when it comes to clamping down on tax-dodgers. Typically, however, their action has been somewhat less convincing.

Take the general anti-avoidance rule (Gaar), trumpeted by Osborne as the weapon with which the government would crack down on tax avoidance and evasion. It’s been obvious to tax experts for some time that the Gaar, in its current form, will do nothing of the sort. It certainly won’t have any impact on Starbucks and co.

As Richard Murphy, of Tax Research UK, has pointed out, Cameron has significantly toned down his language on this issue since claiming in early January that he’d make “damn sure” that the likes of Starbucks and Amazon would pay “their fair share”.

Now he’s talking in terms of tax-avoiders having a “moral obligation to pay up because of the difficulties in cracking down on complex tax schemes”. Hmm, a definite change of tack there.

That firms have a moral obligation to pay their share is not in doubt. But much of the blame lies with HMRC and the government for failing to adapt to the challenge of taxing global corporate appropriately.

Meanwhile, the Revenue has confirmed details of a scheme giving UK taxpayers with offshore holdings in Liechtenstein “the opportunity to make a voluntary disclosure”. If they come forward with details of the tax they haven’t paid in the UK – and it will likely be a rather large sum – they’ll be fined just 10 per cent of the unpaid tax prior up to April 2009 and 20 per cent on tax unpaid since then.

Under the new deal, unpaid tax prior to April 1999 won’t be recovered at all, whereas HMRC would usually go back 20 years. All very soft and a long way removed from the zero tolerance HMRC approach that normal UK taxpayers are confronted with these days.

So it’s convenient that HMRC chose this week to begin releasing details of individual and small business tax defaulters. The nine people and firms listed paid tax penalties of less than £1 million. But it’s a story and as long as it deflects the attention from the continued failure to deal with corporate tax avoiders and evaders, we can expect to hear a lot more of it.

The end of the tax year is coming around quickly and for many savers, failure to act will mean losing almost all of the interest they’re currently being paid.

The savings best-buy tables are dominated by accounts that feature introductory bonuses. These deals come with an attractive rate inflated by a bonus that disappears after 12 months. Once that bonus comes to an end savers are usually left with an account paying little more than the 0.5 per cent base rate, if that.

A year ago, for example, one of the top deals was a 3 per cent cash Isa offered by Bank of Scotland and the Halifax. That includes a bonus of 2.75 per cent, however, leaving savers facing a 92 per cent drop in interest payments once it expires.

Almost all of the top cash Isas last year included bonuses, so if you took advantage at the time you should move your money as soon as the return you get slumps to virtually nothing.

The banks rely heavily on apathy – they know the bulk of customers will simply leave their cash where it is, leaving them with a big chunk of money on deposit that costs very little to service. Don’t make life easy for them at your own expense.