Oral Answers to Questions

Debate between Mel Stride and Lord Goldsmith of Richmond Park

Tuesday 11th December 2018 Commons Chamber

[Zac Goldsmith (Richmond Park) (Con)]

When criticising a Labour Budget in 2005, my right hon. Friend the Chancellor said that the taxpayer

“is entitled to be protected from retrospective or retroactive legislation.”—[Official Report, 7 June 2005; Vol. 434, c. 1139.]

but through the 2019 loan charge, that is precisely what HMRC is now doing to thousands of people who acted in good faith and in accordance with the rules at the time. May I urge my right hon. Friend once again not to backdate the charge to before 2017?

[Mel Stride]

I thank my hon. Friend for his question, but I have to fundamentally disagree with him. The arrangements entered into around disguised remuneration, for which the loan charge is being applied, were always defective at the time they were being used. They have been taken through the courts many times over many years by HMRC and been found to be defective. They also went through, in a particular case, the Supreme Court—the highest court in the land—and the scheme was found to be defective. So this is not a retrospective measure, but it is a question of tax fairness, and of course those who are involved can come forward and have discussions with HMRC, who, where there are difficulties around payment, will be sympathetic and enter into time-to-pay arrangements to make sure those people are protected as well as paying the right tax.