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HMRC slammed by MPs over £25bn tax escape

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A committee on MPs has accused HM Revenue & Customs of offering ‘cosy’ deals to big businesses to settle their tax bills.

A report by the Public Accounts Committee said it had “serious concerns” over how some settlements were reached, citing over £25bn of outstanding tax issues with big firms.

The report calls for HMRC to be more open when it deals with the large tax bills and has singled out permanent secretary for tax Dave Hartnett for criticism, claiming he does not handle tax negotiations properly.

The MPs claim that Hartnett mishandled tax negotiations with big companies like Goldman Sachs, subsequently letting it off millions of pounds in interest on its tax bill. They also claim Hartnett stonewalled their questions at committee meetings in October and November 2011.

Public accounts committee chair Margaret Hodge said: “This report is a damning indictment of HMRC and the way its senior officials handle tax disputes with large corporations.”

“Having looked at the two cases in the public domain, we are concerned that many millions of pounds may be lost to the public purse.”

A spokesman for HMRC said: “”The report is based on partial information, inaccurate opinion and some misunderstanding of facts,”

“The idea Dave Hartnett cuts a large tax bill in return for a glass of wine and a cheese sandwich is just plain nonsense.

“If he was interested in feathering his nest he would have accepted one of the many highly lucrative offers of work he regularly receives from the private sector.”

Hartnett is due to retire in the summer of 2012.

UK Uncut Legal Action, a direct action group, plans to use the report to start proceedings against HMRC over the “sweetheart” deal with Goldman Sachs.

The group is taking HMRC to the High Court on Thursday as it looks for a judicial review to reclaim millions of pounds from Goldman Sachs.

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Readers' comments (9)

  • I smell 'hypocrisy'
    How many of our 'OMG ' MP's are already aware and are benefiting from these 'arrangements'?
    How about we challenge them and get a straight reply 'have you been involved in one of the schemes either directly or indirectly now or in the past'?
    Wait for the silence----------------

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  • They're all at it! Corrupt bureaucrats feathering their own nests and **** the rest of us!

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  • The MP's who regularly charge for their 'influential services' and Business acumen (another name for 'greasing the wheels') should own up and say which companies have paid them that are implicated in this 'scam'.
    They should then pay back the extra that they are now accusing the HMRC of ignoring!!
    Wait for the cheques to roll in,and then to start bouncing.
    I hear a lot of 'snorting sounds' as they gather around the troughs.

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  • Why is this a surprise to anyone---Private Eye magazine has been lambasting HMRC and David Hartnett in particular for years?
    If our darling main-stream media would get their noses out of people's mobile 'phones and start hounding the guilty mandains they might have a bit more public support and a higher circulation.

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  • UK Uncut Legal Action. Hope you win you case.

    Or maybe we should stop paying out tax, that would really break the bank!!

    The poor pay the taxes, the rich get freebies

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  • Even if this is half true (and that's normally a good rule of thumb when it comes to anything MPs say...) than it's truly shocking.

    And it impacts on all of us, because uncollected tax in one place has to be collected somewhere else - most likely from those of us who can't afford to buy lunch for Dave Hartnet.

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  • Just like the clowns at Canary Wharf. HMRC have proved themselves to be untouchable and unaccountable to anyone.

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  • John Lacy (above) is absolutely correct. Private Eye has been running this story for literally years and depressing reading it makes. The Times recently in their report acknowledged that the Eye first broke the details a long time ago
    The principal HMR&C person involved, David Hartnett is, as stated, due to retire next year-perhaps his successor will be less, shall we say, flexible, in collecting tax due.

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  • As John Lacy and Private Eye rightly say this has been going on for many years so there shouldn't be any expressions of shock & horror.
    More than 30 years ago a close relative was the wills, trusts and tax expert at a major firm of City based solicitors and told many tales of stalling and then 'negotiating' with the Revenue and in doing so saving clients £m's. Taxation was considered by the firm to be pretty much optional for their more wealthy clients.

    PS. The above is a pen name.

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