MPs criticise HMRC but are silent on its links with the tax avoidance industry

Prem Sikka, Professor of Accounting at the University of Essex, has summarised the ‘damning indictment’ of the Treasury and tax officials by the public accounts committee report on the operations of Her Majesty’s Revenue and Customs (HMRC), which has revealed that about £25.5bn remains uncollected from disputes with 2,700 companies. 

“This sum is bigger than the budget for the secondary education or transport.” 

He draws attention to HMRC’s ‘cosy relationship with large companies’: 

“[The report] notes that HMRC officials attended numerous lunches, dinners and receptions organised by PricewaterhouseCoopers (PwC), KPMG, Deloitte and Ernst & Young. The lavish hospitality is organised to promote private interests rather than enhance HMRC accountability.” 

Professor Sikka names former ministers, advisers and civil servants who have passed through the revolving door to act as advisers to big accounting firms or have come from these firms to take up government posts, including: 

  • Lord Peter Mandelson – an adviser to Ernst & Young
  • Lord Digby Jones and Lord Norman Warner of Brockley – advisers to Deloitte
  • Former Labour home secretary Jacqui Smith –  consultant for KPMG
  • Former Conservative minister Sir Malcolm Rifkind – an adviser to PwC
  • Former PwC staffer Mark Hoban is the current financial secretary to the Treasury
  • Sir Nicholas Montagu, one-time chief of the Inland Revenue, joined PwC in 2004
  • PwC partner Richard Abadie has been the head of private finance initiative policy at the Treasury
  • Former PwC partner Amyas Morse was appointed UK comptroller and became responsible for directing the National Audit Office
  • Former PwC tax partner John Whiting is the director of the newly established Office of Tax Simplification
  • Chris Tailby, one-time tax partner at PwC became head (until 2009) of anti-avoidance at HMRC
  • and partners from KPMG, Ernst & Young, Grant Thornton and BDO, who became members of the government appointed Tax Professionals Forum to help shape UK tax laws in July 2010. 

Professor Sikka ends: 

“Unsurprisingly, little progress is made on curtailing tax avoidance. The revolving doors must raise questions about the cosiness with the tax avoidance industry and HMRC’s willingness to do secretive deals. Yet the committee raises no questions.”

Read the whole article here.


Posted on December 20, 2011, in Civil servants, Conflict of interest, Corporate political nexus, Government, Lobbying, MPs, Vested interests and tagged . Bookmark the permalink. Leave a comment.

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