HMRC is set to be given more powers to deal with tax avoidance scheme promoters, but the Lords said the promoters must ‘perceive those prosecutions, even when conducted against those operating offshore, are plausible and credible.’

Following their annual review of the latest Finance Bill, the Lords were also highly critical of the doubling of the maximum sentence for tax fraud to 14 years, saying ‘HMRC should review its strategy for the prosecution of tax fraud’ as offenders need to take the possibility of sentencing seriously.

The draft Bill contained two new measures that the government said would target ‘the most persistent and determined promoters’.

Firstly, the draft stated that HMRC would be granted more power to apply straight to court to disqualify directors for persistent promoting of tax evasion schemes.