Stride blames contractors for HMRC loan charge inaction

A defiant and exasperated Mel Stride yesterday blamed contractors for HMRC only now starting to collect tax that it claims was due up to two decades ago.

The MP spoke of a “multitude of reasons” why disguised remuneration scheme users were not pursued when active 20 years ago, and among them are the actions of “many taxpayers”.

“[They] simply did not volunteer the correct information,” accused Mr Stride, referring to their self-assessment forms. “Or [they] claimed their scheme works when clearly it doesn’t.”

The Treasury minister was responding to a question from Tory MP Laurence Robertson, who asked: “If this tax was due then, why did HMRC not obtain that tax then?”

'Weren't telling taxpayers enough'

Previous answers to this question from tax staff have conceded that the department “weren’t telling [affected] taxpayers enough” before 2004 -- the first six years that the tax covers.

But Mr Stride said: “The government have made it very clear over a long period…that the best thing to do is to come and speak to HMRC”. He added “the tax has always been due.”

Campaigners at the Loan Charge Action Group said afterwards online: “[Mr] Stride asserts that the ‘tax has always been due’ yet omits to explain why a new law is needed to collect it.”

'Still misleading'

Also reflecting yesterday on his answers (he gave them on behalf of chancellor Philip Hammond who dodged his four questions – and seven additional questions -- despite being present and at times, smirking), was the Loan Charge APPG.

“Still misleading answers from Mel Stride,” the MP-group said. “[It’s] disappointing but no surprise. The constant misinformation is a key part of the loan charge scandal”.

Trying to extract new, practical information for taxpayers, Julia Lopez MP raised concerns that settling with HMRC deprives their rights to a review in the event of a change in policy.

'We're not going to change'

The Loan Charge APPG described it as a “telling” question. But a resolute Mr Stride sounded offended. “Our policy is our policy, and we’re not going to change our policy,” he said.

Indeed, there will be no pause, delay or independent review to the loan charge -- the minister said, disappointing Christine Jardine MP who asked for such actions.

Similarly, Jo Johnson MP sounded a call to suspend both the loan charge and the rollout of IR35 reforms from April 2020 – “completely unrelated” issues, huffed Mr Stride, rejecting it.

'Not the least retrospective'

The minister also claimed that the loan charge is “not the least retrospective” and said HMRC was taking a “measured, proportionate and sympathetic approach” to collecting the tax.

He failed to acknowledge reports to the Loan Charge APPG of three loan charge-induced suicides, however, and overlooked charges that CEST almost always concludes ‘inside IR35.’

Despite saying the government has a record on curbing tax avoidance of which ‘it can be proud,’ Mr Stride’s responses were characterised by Labour MP Peter Dowd as “feeble”.

For ignoring the suicides, and for speaking four untruths, the Loan Charge APPG preferred them as “shocking,” saying Tory leadership frontrunner Boris Johnson must now intervene.

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Written by Simon Moore

Simon writes impartial news and engaging features for the contractor industry, covering, IR35, the loan charge and general tax and legislation.
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