Tag: Treasury

The press release issued by HM Treasury on 10 November 2023.

The UK has today, 10 November 2023, agreed an historic joint statement with 48 countries to help combat criminals using crypto-assets to evade and avoid billions in missing tax.

• UK leads on first of its kind global commitment to combat offshore crypto tax evasion
• Minister Victoria Atkins praises international cooperation to close gap in global tax system and potentially recoup hundreds of millions of pounds in lost revenue
• landmark agreement follows UK leadership on historic G20/OECD global tax deal agreed in 2021, that clamps down on corporate tax avoidance and will ensure the right tax is paid in the right place

The Crypto-Asset Reporting Framework (CARF), spearheaded by the UK, is the OECD’s latest flagship tax transparency standard. It will mean crypto platforms will need to start sharing taxpayer information with tax authorities, which currently they do not do, ensuring these authorities can exchange information to enforce tax compliance. The CARF is expected to take effect in time for exchanges with other countries to start from 2027.

Today’s milestone follows 2021’s two pillar global tax agreement, which aims to ensure that the right tax is paid by businesses where they operate and cracks down on large multinational enterprises avoiding tax through a 15% global minimum rate.

Financial Secretary to the Treasury, Victoria Atkins, said:

“I am proud that the UK is once again demonstrating leadership on tackling global tax evasion, helping to secure the revenue that’s essential for the public services we all use.

“Today we are sending out a strong message that we will not allow criminals to use crypto to avoid paying their fair share.”

The CARF will build on the existing system tax authorities use to share information with each other, called the Common Reporting Standard. This has already been hugely successful in tackling offshore tax evasion, with almost £100 billion in additional tax revenue recovered from traditional financial assets since its inception in 2014.

The new framework announced today will be essential to counter the increasing level of tax avoidance brought about by the rapid growth of the global crypto market, with some estimates suggesting that tax non-compliance on crypto-asset holdings could range from as high as 55% to 95%.

The UK, which stands to potentially recoup hundreds of millions of pounds as a result of the CARF’s implementation, used its position as a global leader in tax transparency to scope, negotiate and finalise provisions for CARF while galvanising international support.

The press release issued by HM Treasury on 8 November 2023.

Up to £15 million of reallocated funding made available in Northern Ireland to respond to flooding – supporting affected businesses and aiding clean-up costs.

The press release issued by HM Treasury on 27 October 2023.

The landmark change will mean more criminal proceeds are recovered.

• New standards for confiscating proceeds of crime confirmed today to ensure crime does not pay.
• Landmark change requires countries to have non-conviction confiscation powers already in use in the UK.
• More criminal proceeds to be recovered as implementation of higher minimum standards enable improved cross border cooperation.

International action on confiscating the proceeds of crime is to be toughened after a global standard setter today, 27 October, unveiled new rules that represent a major step forward in the fight against economic crime.

The Financial Action Task Force (FATF) as the global Anti-Money Laundering standard setter has announced it is adopting a new set of strengthened standards for seizure and confiscation, as a two-year project co-led by the UK reached its conclusion.

Law enforcement needs a suite of tools to disrupt and disincentivise criminals and strip them of their ill-gotten gains. Over 200 countries worldwide are signed up to the new wide-ranging standards, which for the first time include requirements for non-conviction based confiscation – a useful alternative or supplement to criminal proceedings and an already well used route in the UK to disrupt crime.

The UK’s domestic confiscation powers have been expanded in recent years, leading to the record recovery of almost £340m in 2022 to 2023 – a 75% increase compared to £194m in 2017 to 2018. Of this, £160.1 million was recovered using the UK’s non-conviction based powers.

Treasury Lords Minister Baroness Penn said:

“These new requirements for countries around the world make a difference here at home too – helping disrupt economic crime even when it crosses borders.

“Britain has been consistently driving higher standards in recovering proceeds of crime at the international table and the news today is both long overdue and hugely welcome.”

Security Minister Tom Tugendhat said:

”Criminals shouldn’t be allowed to enjoy their ill-gotten gains. Stripping them of their profits sends a clear signal that we will not tolerate their actions.

“The new standards set by the Financial Action Task Force are an important step in the right direction and send a powerful message.

“We will continue working with the global community to proactively target criminals, take their dirty money and use it for the public good.”

Further information

• The full text of the changes is to be published by the Financial Action Task Force in the coming months. The FATF was set up by the G7 in 1989 to tackle dirty money from drug trafficking. Its mandate has since expanded to look at illicit financial flows across different crime types.
• The Government’s second Economic Crime Plan committed to “Strengthen[ing] international asset recovery standards to improve cross-border asset recovery outcomes”. The updated standards deliver on this commitment.
• Under the Proceeds of Crime Act 2002 (POCA) £339.1 million of assets were recovered from Confiscation, Forfeiture, and Civil Recovery Orders in the financial year 2022 to 2023. This represents another high year of asset recovery and is a 75% increase compared to £193.8 million in 2017 to 2018.
• Of this, £160.1 million was recovered using the UK’s non-conviction based powers – £97.2 million was recovered through Forfeiture Order receipts; and £62.9 million was recovered through Civil Recovery Order Receipts, the highest value ever recorded, driven by a £53.9m order obtained by the National Crime Agency (NCA).

The press release issued by HM Treasury on 12 October 2023.

The Chancellor will attend key multilateral meetings, as well as hold talks with economic partners from around the world.

• Jeremy Hunt, Chancellor of the Exchequer, is in Marrakech, Morocco, for the International Monetary Fund and World Bank Annual Meetings
• Chancellor will attend key multilateral meetings, as well as hold talks with economic partners from around the world
• Chancellor to reaffirm UK’s commitment to fiscal responsibility ahead of Autumn Statement next month

Chancellor of the Exchequer Jeremy Hunt is in Marrakech, Morocco, today and tomorrow (Thursday 12 and Friday 13 October) for the International Monetary Fund (IMF) and World Bank Annual Meetings. He will discuss global economic issues and how to ensure international financial institutions are delivering for all member states, including the most vulnerable, as well as showcase the UK’s leadership on international development.

The Chancellor will also discuss the UK’s economic strategy, highlighting the need to fight inflation and make fiscally responsible decisions. He will reiterate Britain’s backing of international humanitarian causes such as Morocco’s earthquake relief effort, in addition to support for Ukraine following Russia’s illegal invasion and for Israel in the wake of the recent terrorist attacks.

Chancellor of the Exchequer Jeremy Hunt said:

“I’m in Marrakech to discuss the global fight against inflation, and how we are putting Britain back on the path to growth.

“It is because of our solid economic foundation at home that we can support our friends around the world. I am full of admiration for the Moroccan people’s resilience following the terrible earthquake in September, and want to reiterate Britain’s backing to support the victims.”

Also in attendance at this year’s IMF Annual Meetings are Andrew Mitchell, Minister for Development and Africa at the Foreign, Commonwealth and Development Office, and Andrew Bailey, Governor of the Bank of England.

The UK remains committed to supporting Morocco following the devastating earthquake in September, and has allocated a funding package worth up to £10m in response to this and the floods in Libya. A British search and rescue team, as well as a medical assessment team, were also deployed in the days immediately after the natural disaster to support the Moroccan authorities in the affected areas.

The meetings are one of the IMF’s twice-yearly centre pieces for international economic policy. This year’s are the first set to be held outside of Washington D.C. since 2018, when they took place in Bali, Indonesia. They are also the first IMF Annuals held in Africa since 1973, which were in Nairobi, Kenya.

The press release issued by HM Treasury on 11 October 2023.

John Glen spoke to experts in artificial intelligence to discuss the technology’s potential.

The press release issued by HM Treasury on 10 October 2023.

The Chancellor Jeremy Hunt has appointed Michèle Dix CBE – a former managing director of Crossrail 2 and director of planning at Transport for London – to the National Infrastructure Commission (NIC).

The NIC provides impartial, expert advice to government on major long-term economic infrastructure challenges and Michele Dix will bring years of experience in transport, engineering, and planning.

Chancellor of the Exchequer Jeremy Hunt said:

“We need high quality infrastructure to deliver growth and boost productivity. Michèle will help ensure that the National Infrastructure Commission has the right skills and talent to help deliver the infrastructure we need.”

Sir John Armitt, Chair of the National Infrastructure Commission, said:

“Michèle brings a wealth of knowledge of the transport and planning spheres, and she joins us at an important time just as we publish the second National Infrastructure Assessment.

“Michèle’s experience in developing world class public transport systems will help inform the Commission’s ongoing work advising government on how best to promote economic growth across all regions.”

Michèle Dix BSc, PhD, CEng, FICE, FCILT, FCIHT, CBE is currently Non-Executive Director of Crossrail International, Non-Executive Director of the Major Projects Association, and visiting professor at Bartlett School of Planning at University College London.

At Transport for London, Michèle had been Managing Director of Crossrail 2 until October 2021 and had previously been Managing Director of Planning. Michèle started her career at the Greater London Council after completing her PhD in transport and land use planning.

Dr Dix has confirmed she has not engaged in any political activity in the last five years.

The press release issued by HM Treasury on 5 October 2023.

Scammer was due a large financial compensation award but Official Receiver worked with partners to ensure funds were used to repay his victims.

John Gerard Metcalfe, from Essex, was declared bankrupt in 2013 following legal action after he defrauded several individuals and at least one company as part of an investment scam he had run, which saw the victims lose over £2 million.

Metcalfe was subsequently convicted of fraud offences in 2017 and the Crown Prosecution Service (CPS) obtained a compensation order, meaning that he was required to pay as much as he had funds for at the time. It also meant that if Metcalfe came into money at a future date, the CPS could order additional money to be distributed, ensuring that the victims and creditors could receive full compensation.

However, in 2023, the Official Receiver, responsible for overseeing Metcalfe’s bankruptcy, became aware that Metcalfe had received a £3.75 million pay-out from the Foskett Panel, an independent committee set up in 2020 following a banking scandal involving a billion-pound fraud at the Reading branch of HBOS between 2003 and 2007.

Although Metcalfe had been discharged – as normal – from bankruptcy after one year in 2014, the fraud which led to the compensation award had happened prior to the Bankruptcy Order and the pay-out was therefore an asset in his bankruptcy, with payments due to his creditors and victims.

The Official Receiver was also contacted by the Eastern Region Special Operations Unit and the CPS, who had learnt of the pay-out from Metcalfe’s solicitor. The CPS, police and the Official Receiver worked together closely, resulting in Metcalfe agreeing to take part in the CPS Voluntary Reparation process, which provides for compensation to be paid to victims, and in place of a costly formal Proceeds of Crime Act 2002 (POCA) application to court.

It was agreed that the best approach was to pay his remaining victims as creditors in the bankruptcy. As a result, the compensation awarded by the Foskett Panel was paid to the Official Receiver, allowing over £2 million to be returned to the victims of his investment scam. In addition, other creditors have also been repaid and the taxpayer also received around £750,000 which was owed to HMRC.

Joe Sullivan, Official Receiver at the Insolvency Service, said:

Although this bankruptcy case dates back ten years, I am very happy both the victims and creditors are finally able to get their money back. That is testament to the hard work of the team, and I am especially pleased in this case that John Metcalfe’s victims have been repaid after his appalling scam.

Nick Bentley, Financial Investigation Manager at ERSOU’s Regional Organised Crime Unit, said:

Our unit works closely with police forces across eastern England – in this case Essex Police – to ensure that crime doesn’t pay, and individuals who have made money through illicit means are ordered to repay their ill-gotten gains.

We will continue to work with partner agencies and use POCA legislation to ensure, wherever possible, victims of economic crime are compensated.

Mark James-Dawson, Specialist Prosecutor of the CPS Proceeds of Crime Division, said:

This case shows that even when criminals have been convicted and sentenced, the CPS will continue to pursue them for their ill-gotten gains – even if they come into money years after committing their crimes.

Our Voluntary Reparation scheme is a mechanism by which we can secure compensation for victims after the criminal and confiscation proceedings have finished, when further assets come to light. Through joint working with the police and Insolvency Service, we were able to recover significant funds from Metcalfe which will be used to compensate victims of this crime, money which they thought they’d never see again.

Background

• John Metcalfe is of Essex. His date of birth is February 1958.

The press release issued by HM Treasury on 2 October 2023.

Grisha Valchev, 43, of Enfield, has been ordered to repay £43,570 after abusing the Bounce Back Loan scheme. In addition to the compensation order, the judge also disqualified Valchev as a director for nine years.

Valchev was a director of Healthy & Tasty Ltd, a north London-based gift company selling fruit baskets, chocolates, hampers and flowers.

Healthy & Tasty Ltd went into liquidation in July 2021, triggering an investigation by the Insolvency Service which uncovered the abuse of the loan scheme.

On 6 September 2023, District Judge Geddes at the High Court of Justice Business and Property Courts in Leeds imposed the order and disqualified Valchev, after hearing that the director had given false information to claim the maximum Bounce Back Loan amount of £50,000 in May 2020.

The company’s actual turnover on which the loan should have been based was around £35,400, which meant Healthy & Tasty Ltd had been entitled to less than £9,000, and had ultimately received more than five times that amount.

Valchev argued in court that he was unable to repay the money, but the Judge rejected this, and ordered him to repay £43,570, which included the excess amount that he had falsely claimed, plus interest.

Rob Clarke, Chief Investigator of Insolvent Investigations North at the Insolvency Service, said:

Grisha Valchev abused taxpayers’ money to give his company an unfair advantage over other businesses impacted by Covid-19.

This is the first Compensation Order handed out to a director who challenged our case in court. It is a significant result for the Insolvency Service and shows that abuse of the public purse will not be tolerated.

Where there have been similar cases of abuse by a company director, we will be seeking further Compensation Orders and disqualifications.

Valchev’s ban began on 27 September 2023 and lasts for 9 years. His disqualification prevents him from becoming involved in the promotion, formation or management of a company, without the permission of the court.

The press release issued by HM Treasury on 2 October 2023.

The Chancellor has today, 2 October 2023, announced an immediate cap on civil servant headcount across Whitehall to stop any further expansion, increase efficiencies and boost productivity.

• Chancellor announces Civil Service Numbers Cap, capping headcount at current level, which could save up to £1 billion, with focus on a leaner and more effective workforce
• government departments to submit long-term productivity plans that modernise the Civil Service and reduce the size of the state – delivering high-quality public services at a lower cost
• equality, diversity and inclusion (EDI) spending in the Civil Service to be reviewed to ensure it represents value for money for the taxpayer

The Civil Service workforce has grown year on year since 2016, with headcount as of June 2023 around 488,000. While this has enabled an effective response to the challenges of the Covid-19 pandemic, further unabated growth would not be fair to taxpayers or promote the efficiency they expect.

A cap on headcount at its current level will be introduced with immediate effect – a decision that will help cut the cost of government and could save up to £1 billion by March 2025 compared to the current trajectory.

The cap – which will be in place for the duration of the current Spending Review period – does not equate to a recruitment freeze, and current recruitment campaigns will remain ongoing.

To go further after the current Spending Review period, government departments will be asked to produce plans on driving down headcount over the long-term to pre-pandemic levels, as part of the Public Sector Productivity Programme being carried out by the Chief Secretary to the Treasury.

A first-time value for money audit of EDI spending in the Civil Service will also separately inform the productivity review, with the findings and actions to be announced by the Chancellor in the Autumn.

Through tackling unnecessary bureaucracy and improved use of technology, it is expected that the Civil Service will become more productive and act as a lean, agile, and cost-effective organisation, in line with the people’s priorities.

Departmental plans are expected to include detail on how departments will utilise modern technology to drive efficiencies and deliver better services for the public at lower costs – across both the Civil Service and the wider public sector. This process will also prioritise the protection of critical frontline services.

Further information

• Estimated savings are based on the latest available headcount for full-time employee numbers (457,000 as of June 2023) from the ONS (excluding devolved administrations), as well as a projection of 490,000 in March 2025 based on the current trend in headcount growth since 2016.
• The figure is based on a median wage of £32k reported in the latest Civil Service Statistics and additional non-wage costs of £13k per FTE. The figure is subject to change based on departmental negotiations and a later retrospective update to headcount data.
• The cap will apply to all government departments and their arm’s length bodies. Public servants and crown servants will also be included where they are normally in scope of the Civil Service Pay Remit.
• The Civil Service Fast Stream will continue as planned in recognition of the importance of the talent pipeline.
• The Cabinet Office has written to over 100 organisations in the Civil Service, including government departments and executive agencies, to confirm how many staff work on EDI and how that work supports government priorities.
• The Chancellor, Minister for the Cabinet Office and Minister for Women and Equalities will jointly scrutinise whether EDI spending offers taxpayers value for money.

The press release issued by HM Treasury on 2 October 2023.

Changes to the rules which determine whether a bank can operate – known as Threshold Conditions – will ensure banks are upholding their current legal duties to protect freedom of speech.

• Chancellor spells out new rules for banks to protect free speech
• banks forced to show exactly how they are protecting customers’ freedom of speech under a shakeup of the rules
• banks must take existing obligations not to discriminate seriously

This action will give regulators the green light to take firm action if any bank is found to undermine or fails to protect the rights of their customers.

A public consultation will be launched shortly to consider how these changes are best delivered, before legislating next year, as part of the government’s aim to put an end to de-banking for freedom of speech reasons.

This follows concerning reports that highlighted situations where banks may have been closing the bank accounts of customers based on their political views.

The Chancellor was quick to act – confirming new rules will force banks to delay and explain account closures and asking the FCA to conduct a deep dive into this issue.

The notice period for payment service framework contract terminations is to increase from two months to 90 days, and banks will be required to give customers clear and tailored explanations for why they had closed an account – unless in limited cases such as where this would be unlawful.