Question to the HM Treasury:

To ask Mr Chancellor of the Exchequer, how (a) the Government, (b) law enforcement agencies and (c) financial regulators prevent the use of unregulated payments systems for the purpose of UK tax evasion.

HM Revenue and Customs (HMRC) works with a wide range of Government partners, law enforcement agencies and financial regulatory bodies to identify new and emerging risk areas, including the potential abuse of regulated payment systems or the development of unregulated payment systems, which could facilitate tax evasion. HMRC contributed extensively to the development of the UK’s National Risk Assessment for Money Laundering and Terrorist Financing, which included identification of risks associated with traditional and non-traditional payment systems.

HMRC uses its own supervisory powers under the Money Laundering Regulations 2007 to work closely with its supervised entities to ensure they have processes and systems in place to identify potential abuses of payment systems regardless of the predicate criminality, albeit, HMRC can share specific indicators of risk associated with tax evasion. This allows HMRC to take a multi-faceted approach to monitor and respond to risk using the full range of its civil investigation, criminal investigation and supervisory capabilities.

HMRC also works with international partners such as the money laundering supervisory bodies in the United States, Canada, Australia and New Zealand, the Financial Action Taskforce, and the OECD’s Taskforce on Tax Crimes.