Loan Charge 2019: Sir Amyas Morse Review

Anthony Mangnall Excerpts

Thursday 19th March 2020 Commons Chamber

[Paul Holmes (Eastleigh) (Con)]

I congratulate my right hon. Friend the Member for Haltemprice and Howden (Mr Davis) on securing the debate, and all Members who are members of the all-party parliamentary group for being here today. Having been in this Chamber for only four months, I am not as experienced as others in complicated tax arrangements, but, very quickly during my election campaign and during my surgeries, this issue has proven to be a huge worry for the many of my hard-working and honest constituents who run small businesses. For me, thankfully, this is not a debate that revolves around complicated tax issues. It is a debate that revolves around fairness and proportionality, and I think the Government have got that drastically wrong. That is where the Morse review has not gone far enough.

Like my hon. Friend the Member for South Basildon and East Thurrock (Stephen Metcalfe), I believe that everyone in our country must pay the taxes they owe—individuals, businesses, everybody. That is how a responsible society works. But the people this affects are not tax avoiders, so I have some concerns on behalf of my constituents about some aspects of the Government’s approach. I believe that it is my duty as a constituency MP to bring them up with Ministers.

Many constituents have come to see me at the surgery and have told me the severe pressure that this has put them under; the pressure of making payments and possible insolvency has, in some cases, caused the breakdown of marriages, physical exhaustion, and suicidal thoughts through no fault of their own whatsoever. I am also aware from my constituents that many of those who used some form of disguised remuneration scheme did so at the behest of financial professionals they had hired to advise them. Some were told that these schemes were HMRC compliant. Others were not even told that these schemes were tax avoidance and thought that they were normal procedure.

I want briefly to ask the Minister to consider the following points. Of course, any shortening of the time for which people affected are liable for these payments is welcome, but even after 10 years the payments over three years are too regimented and draconian. What thoughts has the Minister had about lengthening the terms? It is simply not fair of HMRC to impose the retrospectivity that follows from this review. As I have said, many people were advised by financial advisers and are now being penalised because of the late realisation and intransigence of HMRC. Does the Minister accept that that should not be a portent for any decision making on policy in this area? What steps is he taking to share the cost burden with the financial advisers who recommended these schemes? They are getting away scot-free.

Lastly, I want to raise the subject of HMRC. Even in normal times, it is not the most transparent Government Department, or the easiest to deal with; it is not known for its empathy or human nature. I really hope that the Government do not continue down this path, but if they do, it is vital that a bespoke, compassionate team be set up solely to deal with the vulnerable people in our constituencies who are affected by this issue.

[Anthony Mangnall (Totnes) (Con)]

That is a gross understatement of HMRC’s lack of compassion. If we are to move forward, HMRC must give individuals who have suffered as a result of the loan charge situation certainty that there will be finality in the way the issue is dealt with.

[Paul Holmes]

My hon. Friend is absolutely correct. His point backs up mine. Any team that the Treasury sets up—and there should be one—to deal with people affected by the issue should treat them as people, not as numbers, which is unfortunately how HMRC has a track record of treating them.