Chancellor, ignoring the hugely unjust Loan Charge won’t make 150 parliamentarians (or us) go away
While all eyes were on his Spring Budget 2023, last week also saw the 150th parliamentarian sign an open letter to the chancellor Jeremy Hunt, calling for a change of approach and a resolution to the Loan Charge scandal, writes Steve Packham, spokesperson for the Loan Charge Action Group.
How's that silent treatment working out for you Jeremy?
Addressed to the prime minister Rishi Sunak too, the letter points out that this scandal has now seen ten people take their own lives while, all the time, HMRC wallows in an administrative and reputational disaster of its own making.
In the last few days and since Mr Hunt’s March 15th statement, more and more MPs have signed an Early Day Motion, EDM 927, tabled by Karl Turner MP and officers from the Loan Charge and Taxpayer Fairness APPG. Signatories now total over 90, far more than most other EDMs.
So for all the government’s attempts to ignore the Loan Charge, there remains very significant concern and opposition to HMRC’s approach, including to contractors.
The Spring Budget that ignored contractors was not the time or place
On Wednesday, Spring Budget 2023 had little to celebrate for self-employed people or contractors -- key groups of workers that surely are crucial if the government is serious about the ‘growth’ it keeps talking about.
The scandalous Loan Charge was ignored, bar yet another misleading announcement of ‘tackling promoters’ that will in reality, as usual, still see innocent people, mis-sold and mis-advised, face the now well-documented ruthless, dangerous pursuit from HMRC.
But the 150th member of parliament signing their name in protest to the chancellor wasn’t in vain. After all, there was no expectation of any announcements on the Loan Charge in last week’s Spring Budget.
Rather, the budget was Mr Hunt’s opportunity and attempt to convince the British public that the government is dealing with the cost of living crisis, and has a plan to get out of it and get the economy growing. With those aims, such a budget would not be the opportunity to announce a change to HMRC’s approach to individuals on an issue that isn’t seen as mainstream, such as those caught up in the ongoing nightmare of HMRC’s Loan Charge.
Will avoidance promoters really get tackled, as we're told?
Found at chapter 2.18 of Spring Budget, the Treasury’s announcement against avoidance scheme promoters would be very welcome -- if it would actually protect taxpayers. But what it appears to amount to is a threat to prosecute promoters, with potential custodial sentences, if they refuse to stop promoting their schemes once HMRC tells them to stop.
What difference will this make in reality? Very little we fear, as promoters will not ignore this, but will instead simply fold their companies and pop them up somewhere else. Meanwhile, those mis-sold their arrangements still face HMRC action, years of stress and financial ruin. Such an announcement therefore, without direct pursuit of promoters for the arising tax liability, as well as being of little real impact in terms of actually protecting workers is also somewhat cynical, as it gives the ongoing false impression of HMRC taking tough action against promoters. These parties will potentially just stop their offerings and move on elsewhere while it is those who used their schemes who actually face all of HMRC’s wrath. We expect promoters, some in plain sight, to continue to enjoy their considerable profits as a result of this announcement to target them. Almost needless to say, the proposed measure for all those caught up in the Loan Charge nightmare, is 20 years 10 lives too late.
As the Loan Charge suicide risk continues, further to ten lives lost, the Treasury talks Samaritans...
Just yesterday, another person came forward to report their attempted suicide. This follows those tragic 10 suicides, now reported by HMRC, and reported to the Independent Office of Police Conduct which, mystifyingly, just refers the cases back to HMRC! What a broken system.
The latest ruse by the Treasury is to appear to be ‘concerned’ by their bringing in of Samaritans, to whom HMRC can then refer suicidal taxpayers to (and then, we anticipate, claim how helpful and responsible they have been).
Yet surely, the very involvement of Samaritans with an approach to taxpayers that is known to have caused ten deaths and nearly caused several others, should say it all. It isn’t sympathetic, it is cynical; and it is calculating – something we believe both HMRC and the Treasury have been all along.
Taxman's tooth and nail witholding effort speaks volumes
Alongside the lack of any real sympathy and any real responsibility, the attempts by both departments to mislead and deceive also continue, as highlighted continually by the APPG. Currently, we are watching the extraordinary spectacle of HMRC fighting tooth and nail to avoid having to publish the first draft of the ‘independent’ Morse Review. That’s an independence which is similar to the supposedly ‘free and fair’ elections in Russia that ensure Vladmir Putin remains at the helm.
The fact that UK officials are so desperate to withhold the first draft of Morse speaks volumes. At the same time, HMRC are keen to celebrate an Information Commissioner Office (ICO) ruling that allows them to withhold some internal emails and other discussions. No wonder they want to do this, considering how their own emails and discussions so far have revealed just how dishonest they have been, painting one picture for MPs and journalists while knowing the reality to be very different.
It is notable that some of the FOIs these officials don’t want to reveal are correspondence and discussions with Sir Amyas Morse. Yet surely there shouldn’t be ANY secret correspondence which they are not prepared to reveal, with the very person carrying out the supposedly ‘independent’ review.
The ICO might not have grasped this. People aren’t stupid and through their own desperation to stop further damning revelations, HMRC has actually further exposed the clear interference with the Morse Review and the unethically cosy relationship with the supposedly independent reviewer.
On top of that, HMRC’s attempts to claim that revealing the truth would have a ‘chilling effect’ on policy debate shows just how rotten HMRC must have become in our view (when what is having a chilling effect on democracy and the civil service is the way HMRC cannot be open and honest).
Bravery, strength, and whether this chancellor has it in him
Problematically, there isn’t allowed to be any proper debate on the Loan Charge, with even Treasury ministers timidly toeing the HMRC line! This is something that has been made sure of all along. The only thing that has challenged this lack of debate has been campaigners and MPs, brave enough to listen to their constituents and speak out.
We are not going to go away. The Loan Charge came in four years ago and while 10 people have killed themselves because of it, others have died from heart attacks and stress, and many have stopped campaigning due to mental and/or family breakdown. The rest of us who remain strong enough to fight will continue to do so until the scandalous Loan Charge is stopped.
If this Conservative-led Treasury continues to act as HMRC’s puppet, and keeps ignoring the way HMRC are vilifying and bullying what an unbiased analysis would determine as the party’s traditional, even core voters, then it will be down to the next government, next year, to resolve the whole mess.
How many more individuals will have taken their lives by then? How many more suicides can Mr Hunt, and by extension the financial secretary to the Treasury, Victoria Atkins, turn a blind eye to? Bringing in Samaritans and citing the charity in parliamentary answers doesn’t cover up the fact that they know their whole approach to the Loan Charge is killing people and that they could stop it -- by simply ordering HMRC to find a different, fairer approach.
Ignoring the Loan Charge scandal, refusing Freedom of Information requests and issuing misleading announcements doesn’t make it go away. It won’t make us go away and it won’t make the MPs who agree that this is a huge injustice go away. We urge Mr Hunt to have the courage to be the chancellor who resolves this abject and tragic mess, and reins in HMRC or we await a chancellor who will, in this or the next government.
If you have a question about contracting please feel free to ask us!