Loan Charge

Marsha De Cordova Excerpts

Thursday 11th April 2019 Commons Chamber

[Marsha De Cordova (Battersea) (Lab)]

I begin by thanking the Backbench Business Committee for this debate, the loan charge all-party group for its fantastic work, and the campaigners for bringing this situation into the public eye.

Many employees signed up to these disguised remuneration schemes and arrangements in good faith, and many of them declared them to HMRC. The problem is that many of them are now being unfairly caught up in the Government’s loan charge. Their retrospective implementation has left many people who were unaware of these schemes with eye-watering bills. That is the case for many of my constituents who have been to see me to explain that they have been unfairly burdened with this charge. They did not know that these schemes were a form of tax avoidance, and now they are being asked to pay back tens of thousands of pounds—money that they can ill afford. The burden of paying it back is causing them great distress, including mental ill health.

One constituent told me that she fears that she will have to sell her home. Another constituent risks going bankrupt, while another just broke down in tears when they visited my recent surgery, fearing the consequences that the charge will have on both them and their family. We know that these are not isolated incidents. All these facts were also revealed in the excellent inquiry into the loan charge by the all-party group.

What is most disappointing about the Government’s response is that this scheme is targeting individuals rather than the companies. It is unfair that many of my constituents are being asked to pay back tens of thousands of pounds. I urge the Minister, when he responds, to commit to suspending the scheme for six months and, more importantly, to calling for a judge-led independent inquiry.