Loan Charge 2019: Sir Amyas Morse Review

Richard Fuller Excerpts

Thursday 19th March 2020 Commons Chamber

[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.

[Richard Fuller (North East Bedfordshire) (Con)]

My hon. Friend puts his finger on one of the core points. Who is running the show here? Is it HMRC, or are the Government making sure that law on this matter is paramount? Does he not find it ironic that HMRC’s annual report this year says that HMRC wants a system that can

“be trusted and seen to be fair, with the right safeguards in place to protect customers”?

Does this case not show that it is falling woefully short of meeting that ambition?

[Paul Holmes]

I agree entirely. This is not the only case of people being treated unfairly by HMRC. I really hope that the Minister listens to the concerns being expressed across the House, particularly about the issue under discussion. There is a wider point here about HMRC. As my right hon. Friend the Member for Haltemprice and Howden said, it has decided to charge people retrospectively although the situation arose through its negligence. Never again—I feel this strongly—should it be allowed to adopt retrospective measures to cover its failure to get its policies in order.

Lastly, the Minister needs to make it clear, hopefully today, that the people affected by this are victims. They are struggling after following advice given to them by independent tax experts. I hope that he will look at lengthening the repayment period, commit to dealing fairly with the people affected by this, and never allow this to happen again. Ideally, he should at the Dispatch Box this afternoon scrap the loan charges affecting so many of my constituents.

--- Later in debate ---

[Chris Stephens]

My hon. Friend is right; that is very sound advice. Everyone who has spoken so far today has been a credit not just to the House, but to their constituents, because there are far too many people—such as my constituents, his constituents and others—who are in despair because of this issue.

[Richard Fuller]

On the importance of Members of Parliament speaking up, is the hon. Member concerned, as I am, that effectively, HMRC is smearing constituents as tax dodgers and adding to their mental anguish, rather than trying to assist them through this process?

[Chris Stephens]

I am not only very concerned, but angry about some of these actions and what I have heard today about what HMRC is up to. I will speak more about that.

When constituents such as Fraser Kennedy and Jason Millington come to us to discuss this issue, three immediate things leap out at us. This has come up in the debate, including in a fantastic example from my hon. Friend the Member for Ayr, Carrick and Cumnock (Allan Dorans). In this Parliament, we really need to deal with the relationship between an employer and a worker and their status in the workplace, because it really is time to end the bogus self-employment that we have heard about in this debate and in other examples. This needs to be addressed because what this issue has proven is that the wrong people are being targeted.

The hon. Member for Beckenham (Bob Stewart) said that when people first come across this issue, it looks like some sort of tax avoidance scheme, and I think it is perfectly natural for someone to think that when it is first explained to them. In the back of my head, when I first heard about it, I thought, “Well, maybe I will approach HMRC as an MP and try to get the same sweetheart deal that Google got only a couple of years ago,” when it paid the equivalent of 4% corporation tax. It seems that there is a disproportionate way that the people who have been caught up in the loan charge are being dealt with compared with other people who can get a sweetheart deal. That is how I thought I could try to deal with it, because if the answer is, “Yes, it is tax avoidance”, then the people HMRC should really be going after are those who contrived and promoted such schemes, because they are the ones who are directly responsible. They should be pursued and punished, and there should not be the blunt instrument that is being used for those caught up in the loan charge.

The third conclusion is, as the hon. Member for North East Bedfordshire (Richard Fuller) said, that there have been disproportionate actions from HMRC towards the individuals who have been caught up in this and how they feel. My constituent, Fraser Kennedy, sums it up well. His employer, Winchester, assured him and HMRC that it had paid all the tax and moneys, but he is still getting chased by HMRC. He feels bullied and harassed, and is suffering from stress and anxiety because of how it has handled the matter. He believed that it was settled a year ago, but he is still getting correspondence.