HSBC Swiss leaks: Labour's Ed Balls blasts George Osborne for tax avoidance 'total failure'

Ed Balls has blasted Prime Minister David Cameron and Chancellor George Osborne for a "total failure" over tackling tax avoidance.

The shadow chancellor stepped up Labour's attack on the government after it was alleged a Swiss banking arm of HSBC advised British clients on how to dodge tax.

The party plans an Opposition Day debate, led by Shadow Treasury Minister Shabana Mahmood, on the issues.

"David Cameron and George Osborne have totally failed to tackle tax avoidance in the last five years," Balls said.

"They have failed to close the loopholes we have highlighted. And the amount of uncollected tax has risen under this government.

"I am determined that the next Labour government will act where the Tories have failed."

Balls promised a Labour government would close "loopholes" and increase transparency.

The shadow chancellor said he would achieve this in their first Finance Bills, which will include penalties for those who are caught by the General Anti-Abuse Rule and legislation to stop umbrella companies "exploiting tax reliefs".

But David Gauke defended the UK government's record on tax evasion.

The Treasury minister, while facing a grilling from MPs, said the allegations about HSBC's Swiss branch relate to the period that Labour was in power.

But he admitted, in response to an urgent question raised by Labour's Mahmood, that the government was first given information about HSBC in May 2010.

"HMRC received the HSBC data under very strict conditions which limited the department's use of it to pursuing offshore tax evasion and prevented HMRC from sharing the data with other law enforcement authorities," Gauke said.

"Under these restrictions, HMRC has not been able to seek prosecution for other potential offences such as money laundering."

The leaked documents revealed the Swiss accounts of more than 100,000 people, including 7,000 British citizens.

BBC's Panorama programme, which was given access to the leaks, said a French investigation had concluded that 99.8% of names on the list had probably avoided tax.

HMRC found 1,100 Brits had not paid enough tax, although the revelations have only led to one prosecution for tax evasion.