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WQ.350/2019
WRITTEN QUESTION TO THE MINISTER FOR TREASURY AND RESOURCES BY THE DEPUTY OF ST. JOHN
ANSWER TO BE TABLED ON TUESDAY 10th SEPTEMBER 2019
Question
Will the Minister consider adopting a system of naming and shaming' people who are deliberately in default of their tax liability, similar to that which exists in the United Kingdom where lists are published online by H.M. Revenue and Customs; and if so, will she provide her assessment of what impact, if any, the introduction of such a system would have on her department's ability to increase revenue returns and on the need for any additional posts within Revenue Jersey?
Answer
Revenue Jersey's approach to tax compliance is founded on international research and best practice in tax administrations worldwide. This sees tax administrations adopting different approaches towards taxpayer segmented according to the behaviours they exhibit. Generally speaking, a small proportion of the taxpaying community do deliberately seek to evade taxes.
The last Government consulted on the issue of so-called "naming and shaming" in March 2017 as part of its review of the tax-compliance framework which led to the tabling of the draft Revenue Administration Law. Question 3 of the consultation document asked "In principle, do you support the denial of anonymity in cases where a taxpayer has accepted a civil penalty in respect of very serious tax evasion? Comments are welcomed on the definition of "very serious tax evasion"."
Responses were mixed. (A summary of responses can be found at:- https://www.gov.je/sitecollectiondocuments/tax%20and%20your%20money/07%20consultation%20on% 20tax%20compliance%20framework%20-%20summary%20of%20responses%20v1.0.pdf)
Revenue Jersey will keep the UK's regime for publishing the names of deliberate defaulters under review.
The Minister is not minded to return to this issue until the new system of civil penalties, contained in the Revenue Administration Law 2019 – which awaits Royal Sanction – has been implemented and sufficient information is available about the number of penalties levied for deliberate defaults.
The arguments for and against such action are likely to be finely balanced. For example, on the one hand, a taxpayer who has deliberately evaded tax may be more reluctant to admit a default if faced with the risk of publication of the details of the default. On the other hand, there is good international evidence that publishing the names of deliberate defaulters can have a wider impact on levels of compliance in the wider taxpayer community.
The increased investment in Revenue Jersey's compliance activities – proposed in the Government Plan – will over the coming years help us to establish the likely scale of tax losses arising from error and misunderstanding; tax avoidance; and tax evasion. Revenue Jersey currently estimates that improved compliance activities will generate around £7 million in additional taxes in 2020.