British chancellor George Osborne under pressure over HSBC scandal

British chancellor George Osborne under pressure over HSBC scandal

16 February 2015, 10:03
News
0
462

George Osborne is being pressured over the HSBC scandal, says the Guardian.

Vince Cable's series of questions over whether he has demonstrated proper vigilance towards inquiries into the bank’s Swiss subsidiaries put British chancellor under the pressure.

HSBC had to go through tough times after The Guardian reported that leaked secret bank account files showed that its Swiss subsidiary encouraged massive tax avoidance and allowed clients to withdraw bricks of cash.

Pointing out that the leaked files related to events eight years ago, Stuart Gulliver, the group chief executive of HSBC Holdings plc, said in the advertisement that society expected better of its banking industry. But Gulliver suggested that the media had focused on 140 clients because many of them were well known.

“We have absolutely no appetite to do business with clients who are evading their taxes or who fail to meet our financial crime compliance standards,” he said.

The team of Tory treasury ministers headed by George Osborne adopted an unusually low profile after their initial response to the HSBC leak – pointing out that Labour’s Ed Balls was responsible as city minister between 2006-07 – was widely challenged. The documents were not passed to HMRC until May 2010. In an interview on the BBC’s Andrew Marr show, Balls mocked the usually television-friendly chancellor for his absence from the nation’s screens, says the Guardian.

In his letter to the chancellor, in which he posed a series of questions, the Liberal Democrat Vince Cable asked why there had been so few prosecutions when there was clear evidence of illegal tax evasion. He also asked what is being done to recuperate lost tax revenue and what lessons are being learned.

Cable told Pienaar’s Politics on BBC Radio 5 Live: “I have written to the chancellor during the week on the back of the HSBC issues asking for satisfaction that the various inquiries that took place around the Swiss subsidiaries have been properly followed through and there has been sufficient level of vigilance.”

The business secretary also criticised the way in which HMRC takes a tough approach to relatively less well off taxpayers while taking a lax approach towards large corporations. He said: “If you are a small company or an ordinary individual, you are often hounded by HMRC often for small sums of money. I’ve got disabled people who’ve had their benefits taken away because there was a suspicion they may have claimed a few pound extra. And yet at the same time, large numbers of people are getting away with millions with apparently rather perfunctory investigations.”

The intervention by Cable came as Danny Alexander, the Liberal Democrat chief secretary to the Treasury, said he had written to HMRC to ask whether they had adequate powers in light of the HSBC scandal.

Alexander told BBC1’s Sunday Politics: “What worries me about this recent case is do we need extra legal powers for HMRC, for example? Is there a need to make sure that there are additional offences for people who are conspiring to enable tax evasion? I’ve asked HMRC for their advice on that and if they come back and say we need extra powers, we need extra resources to tackle this particular problem, as I have at every stage in this parliament I’ll make sure they have what they need.”

As The Guardian revealed that as many as seven Tory donors legally held bank accounts at HSBC’s Swiss subsidiary, the whole scandal placed intense pressure on the Tories.

Share it with friends: