David Cameron and Nick Clegg have raised the prospect of bringing in new powers to curb tax avoidance by leading companies and wealthy individuals.

Graham Aaronson QC, a barrister specialising in tax cases and commissioned by the Treasury to lead a review of tax avoidance last year, explains that the purpose of the proposed new rule is to ensure attempts to exploit the tax code by "abusive" and "artificial transactions" do not achieve their objective.

He adds that they have gone to extreme lengths to ensure the citizen is protected without giving too much power to the state, and the inland revenue "in particular".

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