Government has never tried to recover legal costs from promoters of tax avoidance schemes and continues to award them taxpayer funded contracts
Despite the evidence of fraudulent schemes, no major accountancy firm has ever been disciplined by any professional accountancy body
Professor Prem Sikka writes that Her Majesty’s Revenue and Customs (HMRC) is investigating some 41,000 tax avoidance schemes, but there is still no investigation of the industry that designs and markets aggressive tax avoidance schemes . . .
Now the public accounts committee (PAC) chair Margaret Hodge has PwC, Ernst & Young, KPMG and Deloitte in her sights. The PAC should investigate the role of these firms in organised tax avoidance. An earlier internal HMRC study estimated that these four firms “were behind almost half of all known avoidance schemes” . . .
Despite the evidence, no accountancy firm has ever been disciplined by any professional accountancy body and despite spending millions of pounds to quash predatory schemes, the UK Treasury has never sought to recover the legal costs from the promoters of the schemes. Instead, the big accountancy firms continue to receive taxpayer funded contracts . . .
No government will be able to effectively tackle tax avoidance without shackling the designers and enablers.
Read the whole article here: http://www.guardian.co.uk/commentisfree/2012/dec/08/predatory-practices-accountancy-firms
Private Eye has repeatedly detailed the shortcomings of HMRC at length but earlier this year an ‘insider’, Osita Mba, a tax solicitor at HMRC, testified to two parliamentary committees that the Permanent Secretary for Tax, Dave Hartnett, excused Goldman Sachs from paying £10million in tax owed.
Mba, who trained as a barrister in Nigeria and completed his master’s degree at Oxford, worked in the personal tax litigation team from February 2007 until November last year. He wrote to Amyas Morse, the auditor general of the National Audit Office, in March, outlining his concerns over the deal, but the subsequent NAO report did not name Goldman Sachs.
In October, Mba sent a detailed submission to the parliamentary committees claiming that Hartnett had misled the committee over his role in the Goldman Sachs deal. Hartnett has denied deliberately misleading them – but is to retire . . .
Despite speaking out in the public interest and following whistleblowing protocols, it was reported earlier this month that Osita has been threatened with an internal HMRC investigation.
On the 16th came better news: officials at Revenue and Customs are reconsidering disciplinary procedures against him and the “fact-finding” investigation has been suspended.
As the Nigeria Village website says:
“Here is one man doing all of us proud! He is not being hounded for corruption, but for trying to stop corruption, not in Nigeria, but in good old Britain!
Verdict: Promote him!