HC Deb 06 December 1990 vol 182 cc442-3
8. Mr. Gareth Wardell

To ask the Chancellor of the Exchequer what steps he is taking to prevent tax avoidance.

Mr. Maples

The Government have introduced several measures to limit the scope for tax avoidance and are prepared to introduce further measures as and when necessary.

Mr. Wardell

What is the estimated total loss of tax revenues to the Exchequer through artful dodgers using offshore trusts as a way of avoiding tax?

Mr. Maples

By the very nature of the tax avoidance mechanism to which the hon. Gentleman refers, it is impossible to make such an estimate. We blocked up some loopholes in the Finance Act 1981, but others remain. All questions of tax avoidance are under constant review. Labour tabled a new clause to this year's Finance Bill that would have dealt with one minor aspect, but it is a complex matter. I am advised that simply to introduce an exit charge on trusts to foreign jurisdictions would involve more than six pages of legislation.

Mr. Hannam

Does my hon. Friend agree that the most effective way of reducing tax avoidance is to lower general taxation, which is something that Labour never understands?

Mr. Maples

My hon. Friend is completely right. One reason why Britain has such a widespread and sophisticated tax avoidance industry is the ridiculously high marginal rates that we suffered under a Labour Government.