At long last the government agrees with me on personal service companies

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I have said for quite a number of years that personal service represent tax avoidance activity. I included an estimate of the cost they create in the TUC's The Missing Billions, for example. And I was ridiculed - especially by Tories - for doing so.

But tonight in the Guardian it is  noted of Tory Treasury minister David Gauke:

Gauke also broke new ground for treasury ministers, who do not usually comment on the tax affairs of an individual or an individual company, when he indicated that the BBC may have been complicit in tax avoidance.

The corporation has been criticised for allowing some of its stars to be paid through companies rather than the usual PAYE payroll.

"You are not the first to mention the BBC," he said when asked whether he had raised the issue of the BBC.

Personal service companies are not necessarily always there for tax avoidance purposes. But where arrangements are artificial, where they are contrived and designed for the purpose of reducing the national insurance contributions liability of the employer or the employee or both, then those artificial arrangements do constitute tax avoidance and that is something HMRC will and should take seriously.

"I don't want to be drawn into individual cases as they depend on the individual circumstances. But tax avoidance is tax avoidance."

It seems it takes five years or so on average, but agreement always arrives on what I and the Tax Justice Network say. Better late than never.

Now, what are you going to do about it Mr Gauke?


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