The All-Party Parliamentary Loan Charge Group have today written to the Chancellor to complain in the strongest possible terms against the accusation in the report issued on March 26th (‘Report on time limits and the charge on disguised remuneration loans’) in which they totally misrepresent what was agreed in a meeting on 31st January 2019.

At the meeting on January 31st between officers of the APPG, the Treasury and senior members of HMRC, it was agreed that the identity of witnesses making submissions to the Loan Charge Inquiry would only be shared with HMRC where the APPG had been given permission. HMRC are now saying that the APPG has not met this commitment.

Page 5 of the Treasury report contains the following false statement:

“The Chair of the APPG had volunteered a commitment, when meeting the Chancellor and the Financial Secretary, that these testimonies would all be provided on the basis that the taxpayers concerned would give their consent for HMRC to respond transparently to the many particular personal tax issues that they raised. Unfortunately, that commitment was not sufficiently met, and none of the submissions have been provided on that basis. The government is therefore not able to respond to the detail of those cases in this report.”[1]

This is repeated again on page 10 (Section 1.4)

This is completely false – the APPG did exactly what was agreed and shared some seventy submissions with HMRC on the 8th March. 

Sir Ed’s letter, on behalf of the APPG, to the Chancellor, of February 19th clearly stated what had been agreed:

“[…] HMRC wished to be able to present their factual assessment of taxpayers’ situations, where taxpayers facing the Loan Charge give evidence to the inquiry. Where taxpayers are prepared to do this, the APPG will seek to put their names forward.”[2]

The APPG sent 70 written submissions to Ruth Stainer of HMRC on March 8th and made clear that all the named taxpayers had given permission to have their cases shared with HMRC. These submissions were shared with a cover letter that stated:

“As agreed, sample evidence of personal submissions, where individuals have consented to have their cases shared, are available to HMRC”

and laid out the agreed process for HMRC to correspond with the APPG, namely that,

“HMRC may write to the APPG about the individual taxpayer’s case(s), giving their view of the case and their actions”.

It was expected that HMRC would then write to the APPG, as discussed, on each one. HMRC have not written to the APPG about any of these submissions. This is yet more evidence of bad faith and in this case a downright lie about the APPG failing to do what had been agreed.  

The APPG received no further correspondence, nor a single response, from HMRC regarding these submissions. For HMRC and the Treasury to suggest the APPG reneged on their commitment, is a false claim.  The documentation clearly shows that the APPG have done exactly what was agreed and it is HMRC who have reneged on this.

 The APPG have written to the Chancellor to demand a retraction and apology from the Treasury over this false claim in their report.

The Loan Charge is a retrospective charge that comes into effect in April this year and overrides existing statutory protections, allowing HMRC to go back and demand tax for arrangements that were legal. This includes ‘closed’ tax years, where HMRC failed to raise any concerns at the time and missed the statutory time limits in which to challenge tax returns. The Loan Charge was passed into law in November 2017 with scant parliamentary scrutiny, a flawed impact assessment and with the Treasury ignoring many submissions that expressed grave concerns about the measure.

The Treasury report has been described as a sham, a whitewash and a cynical and misleading attempt at justification of an unjust policy. The Loan Charge APPG is soon to publish the report of the group’s Loan Charge Inquiry. Both the Minister, Mel Stride, and HMRC were invited to attend the third and final oral evidence session. Both declined to do so. 

The letter to the Chancellor is here:

Sir Ed Davey MP, Chair of the Loan Charge APPG (Liberal Democrat) said:

“It is disgraceful that the Treasury have published a false statement in their dreadful whitewash report into the Loan Charge. We agreed, in person and in writing, to send taxpayer submissions to HMRC and they agreed to write to us about them. We did exactly what we said we would. They reneged on what was agreed and failed to write to us at all in response.

“We have written to the Chancellor demanding that the Treasury retract this untrue accusation and issue an apology.  It’s deeply worrying that Ministers have signed off this false claim and I’m afraid yet another example of the chronic misinformation coming out of the Treasury”.

Ruth Cadbury MP, Vice-Chair of the Loan Charge APPG (Labour) said:

“The Treasury is somehow suggesting we didn’t send HMRC the taxpayer submissions as agreed. As is clear and explicit in the letter to Ruth Stanier when we sent them, we were sharing the 70 submissions where taxpayers had given their permission. We expected HMRC to consider them as discussed and they have failed to do so. To say we haven’t done what we said we would is a downright lie and another attempt to obscure the reality of this awful policy. 

Ross Thomson MP, Vice-Chair of the Loan Charge APPG (Conservative) said:

“The whole Loan Charge scandal has been dominated by HMRC seeking to mislead MPs and journalists. To now come out with a barefaced lie about the Loan Charge APPG just shows how out-of-control they are. It’s time for a proper investigation into HMRC and the culture within the organisation as we cannot have a situation whereby a public body is issuing misleading and in this case false statements”.


Notes to Editors

  1. The All-Party Parliamentary Loan Charge Group (Loan Charge APPG) has been created to bring together parliamentarians of all parties from both Houses of Parliament who have concerns about the nature and impact of the ‘2019 Loan Charge’ which will come in to force on the 5th of April 2019 and also concerns about the wider context of fairness of tax legislation and HMRC’s conduct in enforcing it. See and Twitter @LoanChargeAPPG. The Loan Charge APPG is an officially registered Parliamentary Group, as described on the UK Parliament website
  • The Officers of the Loan Charge APPG are as follows:
  • Rt Hon. Sir Ed Davey MP, Chair, MP for Kingston and Surbiton (Liberal Democrat)
  • Ruth Cadbury MP, Vice-Chair, MP for Brentford and Isleworth (Labour)
  • Ross Thomson MP, Vice Chair, MP for Aberdeen South, (Conservative)
  • Rt. Hon. Baroness Kramer, Vice-Chair, (Liberal Democrat)
  • Liz Twist MP, Vice-Chair, MP for Blaydon (Labour)

[1], pg.5