Loan Charge

Andrew Bridgen Excerpts

Thursday 18th January 2024 Commons Chamber

[Neale Hanvey]

I thank the right hon. Gentleman for that point. Not only were the victims of the loan charge victims of mis-selling; they are now the victims of HMRC’s pursuit of them for every penny they can possibly earn. That is not just now, but for future years, so that point is incredibly important.

It is important to remember that we had an opportunity a number of years ago to write off the retrospective element, with new clause 31 to the Finance Bill, which was supported by the loan charge and taxpayer fairness all-party parliamentary group. Unfortunately, because of the timidity of some Members, that new clause was not put forward for a vote. That is deeply regrettable.

It is important that I speak about my constituents, who are my main concern in all this. Four years ago, I spoke about the horrific plight of my constituent Doug Aitken, who was facing a bill of £500,000. To pay that off, he would lose his house and his car. As a self- employed person, he would lose his business, because he would be bankrupt. The Government simply did not listen. He was one of those who had successive completed and closed tax years that were reopened by HMRC, and he was being charged exorbitant, unjustifiable and unjustified rates for all the supposed earnings he had secreted away.

Today I want to speak about another constituent of mine, Alan Geddes, who has a disposable income of £360 a month. The payment demanded by HMRC from Mr Geddes is £783 a month for the next 12 years. That is not the only charge it is asking him to pay; it is also asking him to pay £50,000 up front.

[Andrew Bridgen (North West Leicestershire) (Ind)]

The hon. Gentleman and many other colleagues across the House have made analogies in their excellent speeches between the horrors of the Horizon Post Office IT scandal and the scandal around the loan charge, which has affected so many of our constituents. I will share with him and the Chamber another analogy: is he aware that HMRC also uses an apparently bombproof system from Fujitsu?

[Neale Hanvey]

The hon. Gentleman makes a very interesting point to which I think Members from all parts of the House will pay close attention. I thank him for doing so.

Not only is HMRC asking for £50,000 up front, but it has put a £50,000 lien against Mr Geddes’s home. Although his disposable income has now dropped below £360 a month because of the cost of living crisis, HMRC has suggested that perhaps they should renegotiate his terms to bring the rate down to £361.13. However, to get that new rate, he needs to give HMRC another £50,000. Those other charges would then continue for a further 12 years. The question is: what planet is HMRC on? These shocking figures exclude interest being added to allow the payments to be spread over 12 years. It is clear daylight robbery.

Ministers in the Department have previously advised me that approximately 80% of the £3.4 billion that HMRC has recovered through disguised renumeration settlements between the Budget of 2016 and the end of March 2022 has been from employers. Am I therefore correct in presuming that that figure is £2.72 billion? Given that the sum that HMRC expected to be brought into charge from employers has already been exceeded, why did it need to pursue loan charge customers for 100% of the tax plus interest, plus accelerated payment notice penalties and plus inheritance tax, particularly when it was fully aware that customers had already suffered a 15% to 20% deduction on their earnings through the mis-sold schemes?

Additionally, I would like to learn why HMRC continues to pursue customers with loans from before December 2010, given that Morse already pardoned those with no open inquiries on the basis that the law was not clear. Those key factors could all be addressed, because HMRC has the facility to amend its settlement terms. It requires no legislation or change in the law. I hope that the Minister will ask HMRC to apply the same treatment to those who have already settled.

Members across the House have been screaming on this issue until we are hoarse. We have sent repeated letters, including ones sent by 120 MPs. We have had publications put out by the APPG and debates in this Chamber, but it is simply not enough. People are on the brink and in despair. If we are to prevent any more constituents from resorting to suicide, we must urgently deal with this issue and grapple with it in a way that was not done with the Horizon scandal.

--- Later in debate ---

[Nigel Huddleston]

There has been debate and disagreement on that, particularly as it relates to section 44 of the Income Tax (Earnings and Pensions) Act 2003 and so on. HMRC has outlined the policy stance on this. Although I understand that there is disagreement, the line is quite clear at the moment.

[Andrew Bridgen]

I agree with the Minister that there is responsibility on all individuals to ensure that their tax affairs are in order and the correct tax is paid, but what will he tell the House about HMRC’s responsibility to make the public aware that certain schemes may be seen as tax evasion and therefore do not qualify for tax relief?