According to Pinsent Masons, sentences for tax fraud have been increased by 25% to four years and one month, up from three years and three months a year ago.
The firm said that the longer sentences follow efforts from HMRC to toughen its stance against tax evasion, as well as growing political pressure.
A 2016 report from the Public Accounts Committee (PAC) that said HMRC did not have a clear strategy for dealing with tax fraud and was not working up enough cases for prosecution.
In the last few years, HMRC and the Crown Prosecution Service (CPS) have been advocating in court for tax fraud cases to be considered in more serious categories of offence.
Olga Tocewicz, senior associate at Pinsent Masons, said, “HMRC is pushing hard for longer sentences as it clamps down on tax evasion.
“Even in cases where the prosecution secures a conviction, it may still appeal if it thinks the sentence is not tough enough.”
The firm also warned that individuals and businesses are facing stringent additional new laws for offshore tax evasion that will come into force this autumn.
New laws have been introduced meaning that those who design, market or facilitate the use of tax avoidance arrangements that are defeated by HMRC could have to pay a fine of up to 100% of the tax the scheme’s user underpaid.