Loan Charge

Debate between Adam Holloway and Lord Bellingham

Thursday 11th April 2019 Commons Chamber

[Adam Holloway]

I thank my hon. Friend and absolutely agree.

My view has since shifted, however, as I have come to understand more about their circumstances. These people are not pocket Al Capones out to defraud the system; they are self-employed professionals who are contracting to different entities, paying their own pensions, without the protection of regular employment, and trying to avoid the complexities of IR35. I guess any of us would wish to minimise the tax we pay, and HMRC knew about those arrangements for decades and was slow in taking legal action, and inept in shutting it down.

[Sir Henry Bellingham (North West Norfolk) (Con)]

Does my hon. Friend agree that one of the great iniquities here is that HMRC knew what was going on but did not actually do anything about it with expedition and decisiveness at the time?

[Adam Holloway]

Absolutely, and now of course it is pursuing an aggressive policy that, on any analysis, is retrospective on my constituents. These constituents may have been naive and over-optimistic, but most of us are in no doubt that, for many years, they all believed that these schemes were lawful and an effective means of mitigating their tax. I therefore support a delay to the implementation of the loan charge to allow an independent tribunal to assess the issue of retrospectivity, and, in light of that, to consider whether the loan charge is fair and proportionate after taking into account, first, the failure of HMRC to take effective action for all those years, and, secondly, the fundamental protections that every taxpayer should expect.

Finally, I fear that this policy is another example of how those at the very highest echelons of our Government seem to have a tin ear when it comes to the good people whom they represent.