As the Guardian reports this morning:
Britain's most senior taxman has admitted making "governance errors" when agreeing multibillion-pound settlements with large companies.
Dave Hartnett, HMRC's head of tax, has conceded that Revenue officials did not follow correct procedures in two high-profile cases that could have left taxpayers millions of pounds out of pocket.
Bluntly, although I make no suggestion at all of personal wrong doing it is now very clear that Hartnett did not follow the rules on Vodafone and Goldman Sachs and both got away with millions or even billions in tax as a result, and we still have no way of finding out way, and what action is being taken to put matters right.
In that case where UK Uncut right to protest that something very serious was going wrong inside our tax system? Unambiguously, yes they were - not least because this would not have come out otherwise.
And are those who say the tax gap is much bigger than it need be because senior management at HMRC are firstly not doing what is needed to address it and secondly aren't even making the case that they should be doing something about it justified? Absolutely yes.
There is a choice right now. We could spend £1 billion to recruit 20,000 new staff at HMRC to tackle tax evasion and tax avoidance. I believe that would yield at least £10 billion and maybe quite a lot more. It gets people to work too. And in the process it will help create a level playing field between honest and dishonest business and help close the deficit. It's a no brainer. But it's not happening.
That's dodgy too.
HMRC needs radical reform - and unless Hartnett shows he's up to the job soon he's definitely a major part of the problem, and cannot be part of the solution.
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Surely if they wanted to get rid of Hartnett- such an admission of wrongdoing would be grounds for dismissal without recompense?
@They’ obviously do not want to get rid of him and he knows, it otherwise he wouldn’t have said what he did.
How do they tackle tax avoidance exactly when, by definition, it’s completely legal?
We’re not back to that trite one, surely?
The difference between tax avoidance and tax evasion is usually being caught
That’s why what is called avoidance has to be tackled
The world is not that simple black and white place you suggest it to be
So what you are saying is that the tax laws should be changed so that these schemes don’t work ie become illegal evasion. That’s fine but that is not hmrc’s role is it. That’s for parliament
No that’s not what I’m saying
I’m saying a general anti-avoidance principle should stop them
And HMRC writes such stuff if you did not know it
Perhaps we need to come up with a different terms for certain types of avoidance. Me putting money in an ISA is avoidance but is in terms of the spirit of the law, but me using a vehicle to turn income into dividends may be legal avoidance but goes agains the spirit of the law. Perhaps we need to call the latter type of avoidance something like technical evasion. That would stop the confusion of what is intended to be legal and what is just technically legal.
Read this http://www.taxresearch.org.uk/Documents/TaxLanguage.pdf
“HMRC needs radical reform ….”
At present the HMRC is providing the public with very shoddy service delivered by managers receiving large salaries for incompetence. (Although no doubt in the lower echelons there are some highly dedicated but constantly thwarted tax inspectors)
Allowing large companies to get away with tax evasion/avoidance/dodging is not acceptable — and an even more exasperatingling this could be so easily corrected.
Equally easily corrected are the sleazy islands of Jersey, Guernsey and the Isle of Man.
For goodness sake HMRC, get of your backsides and start making some real effort for the sake of the millions of honest, hardworking British tax payers.
Today’s headline from Richard’s least favorite newspaper …
BRITAIN ‘LOST’ £35BN IN UNCOLLECTED TAXES LAST YEAR
Britain lost £35bn in uncollected taxes last year – the equivalent of 7.9pc of the annual revenue, the Treasury has admitted.
http://www.telegraph.co.uk/finance/economics/8778727/Britain-lost-35bn-in-uncollected-taxes-last-year.html
————————————————————————-
A further outrage in the catastrophe lies is the FACT that the greater part of this huge loss to the UK Exchequer and honest UK taxpayer comes courtesy of the rich friends of George and Dave.
Not forgetting the three pigsties.
And judging by some of the comments posted by “telegraph readers” under the same article they appear to have more in common with Mr. R. Murphy than previously thought!
You would have thought Hartnett had been at HMRC long enough to fully understand its system and procedures for governance, Richard. Furthermore, he could not have made those decisions alone, and therefore other senior people are implicated in these ‘errors’. If we are therefore to believe this line (spin) a good number of HMRC’s senior managment were all unaware of the relevant governance systems and procedures, or were but made no attempt to intervene in Harnett’s actions. In both case these are serious failures of management, so I wonder what HMRC’s Board are doing about this. If nothing, then surely they are also guilty of serious failures of governance? My own opinion would be that this is all rubbish and that these ‘errors’ were recognised at the time, but ignored, for reasons I/we can only guess at.
This could be why 80+% of senior managers in HMRC voted for industrial action recently on a 68% turn out – saying they will not take part in assessment processes amongst other things
Could this be a message of no confidence, perhaps?
I think so
I agree your assessment
As near as dammit 🙂
Governance is actually the responsibility of the HMRC’s General Counsel and Solictor Mr Anthony Inglese. According to Private Eye, he signed off the Goldman Sachs settlement dispite the objections of the lawyers involved in the case and indeed his own acknowledgement of irregularities in the Hartnett deal.