Tax avoidance advisers to face tougher penalties from Treasury

Currently those who advise on tax avoidance face little risk, whereas their clients face penalties if they lose in court. Tax avoidance costs the government nearly £3bn a year.

It was suggested, from the consultation document from the government, that advisers could face a fine of up to 100% of the tax that was avoided, including money from offshore tax havens.

The new rules would also make it simpler to enforce penalties when tax avoidance schemes are defeated in court.

Jane Ellison, financial secretary to the Treasury, said: "People who peddle tax avoidance schemes deny the country of vital tax revenue and this government is determined to make sure they pay. The vast majority of their schemes don’t work and can land their users in court facing large tax bills and other costs.

“These tough new sanctions will make would-be enablers think twice and in turn reduce the number of schemes on the market."

In her maiden speech as Prime Minister in July, Theresa May said that she would tackle corporate tax avoidance.

May said: "Tax is the price we pay for living in a civilised society...It doesn't matter to me whether you're Amazon, Google or Starbucks, you have a duty to put something back, you have a debt to fellow citizens and you have a responsibility to pay your taxes."

The government had also set up a new task force to investigate the allegations of money laundering and tax avoidance in response to the Panama Papers leak in May, from Panamanian law firm Mossack Fonseca, which revealed millions of documents detailing the use of offshore companies for tax evasion.

The new rules do not target legitimate ways of cutting tax such as individual saving accounts (ISAs) or tax breaks for putting money in a pension, rather it is targeting individuals or companies that bend the rules to gain an advantage which parliament never intended.