Unanswered Loan Charge campaigners say no news is good news

A ‘no news is good news’ verdict has been sounded by Loan Charge 2019 campaigners, in reply to concern about appeals for its suspension and review going unanswered.

Speaking in light of the prime minister, the chancellor and a Treasury minister not yet replying to the appeals, LCAG said the aim of writing to them is to ‘highlight and challenge.’

“It isn’t [necessarily] to get a reply,” a spokesman for the Loan Charge Action Group said. “Nor would the reply [likely] be of any interest. It’s the challenge that is the [point].”

'Surely it's time'

The reassurance to ContractorUK and other contractor sites who have written to but not heard back from Boris Johnson and Sajid Javid, came after the 212th MP wrote to Jesse Norman.

David Mundell MP is also the 82nd Tory MP to have added their name to a letter to the Treasury’s Mr Norman, calling for the Loan Charge to be paused pending a judge-led review.

The Loan Charge APPG, a 150-strong cross-party group of MPs concerned about the Loan Charge’s impact on families, believes that with so many signatories, ‘surely it’s time to act.’

'Pause this process'

If it isn’t time, Keith Gordon QC wonders: “How many parliamentarians does it take to condemn the Loan Charge before it is clear…that [it] no longer reflects the will of parliament?”

The barrister, who says HMRC tends to use low estimates when assessing taxpayer impact but high estimates when assessing revenue risk, was responding to a tweet by Bob Neil MP.

“Pleased to have signed Ross [Thomson’s] petition on the Loan Charge,” Mr Neil tweeted.

“Common justice dictates that, out of decency and fairness, we pause this process, ensure there is an independent review of the charge, and have time to fully and properly digest its findings.”

'Make a loan shark blush'

But an “extraordinary” development taking place right now in relation to the Loan Charge is that HMRC is demanding contractors pay more per month than their income, the APPG says.

“[The Revenue is doing this] instead of offering remotely reasonable terms”,  the MPs said last week. “It would make a loan shark blush and would, from a lender, be illegal.”

The cross-party MP group is also unsurprised at the accusation that HMRC tends to use large amounts to gauge the exchequer risk of the Loan Charge (“£3.2billion”), and small amounts to show the impact on taxpayers (“50,000” cited as affected, each owing an average of £13k).

“It is a key and deliberate part of HMRC’s dishonest Loan Charge propaganda,” the MPs tweeted. “On the one hand misrepresenting how much it will bring in (knowing they are discounting bankruptcies and misrepresenting the employer situation); on the other misleading over individual liabilities.”

'Serious impact'

The Treasury said, at the Westminster Hall debate in April -- the month when the Loan Charge took effect: “It has been assumed widely…that the vast majority of those impacted by these measures are individuals.

“That is not the case. Of the 6,000 settlements to date, the £1billion it [the Loan Charge] has brought it in; 85 per cent by value has come from employers not employees. And in the first instance, HMRC will go to the employer, not the employee.”

Online, Mr Thomson’s petition states: “We urge the government to put all settlement activity on hold and that all settlement agreements, including agreed payment plans, be suspended until the independent review is completed and Parliament has considered its conclusions.”

The petition warns: “If the policy continues unamended, there will be many bankruptcies, at a significant cost to the taxpayer.

“Some individuals affected will be unable to work again, following a bankruptcy, and quite a number that we are aware of are already retired. The human impact, which is becoming increasingly apparent, will be serious.”

 

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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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