The Parliamentary Accounts Committee has been investigating the work of H M Revenue & Customs. It has been assisted in its work by HMRC lawyer Osita Mba who decided to tell them the truth about what was happening in his department and the legality of certain claims made by its management. Their report is due tomorrow, and is likely to be highly significant. As the Telegraph reported yesterday:
The National Audit Office (NAO) is poised to investigate “sweetheart” corporate tax deals agreed by HM Revenue and Customs that are alleged to have cut companies’ bills by billions of pounds. It is thought the NAO could examine up to 10 tax deals involving large corporates. Its investigation, which will be led by a judge, will follow this week’s highly critical report from the Public Accounts Committee (PAC) into agreements struck between HMRC and companies to settle tax disputes.
Tuesday’s report centres on agreements made by Dave Hartnett, HMRC’s permanent secretary for tax, with Goldman Sachs and Vodafone – though PAC hearings found two undisclosed companies had also struck similar settlements. Owing to a “mistake” admitted by HMRC, Goldman ended up paying at least £10m less tax than was due on bonus payments. Vodafone settled a long-running dispute for £1.25bn but the PAC heard allegations that the bill should have been £6bn or more.
It's going to be a fun report. But let's also be clear what they are calling for: they're saying we need a tax authority run by a tax authority that believes in tax, the rule of law and the right of the state to recover what's due to it. The sort of tax authority a Courageous State would run.