BN66 - the road to Judicial Review

[ASB]

[flameproof undies]

Look you filthy tax avoiding scum you're just getting your just deserts.

Actually I don't believe that - but trying to convince the man on the Clapham omnibus is going to be impossible.

DR et al are doing absolutely sterling work, but there is no chance of getting the hearts and minds of the populus at large. Whilst there should not be a moral argument the fact is there is - and it can't be won.

Personally I am concerned about the MP's bleating. Unfortunately the man in the street thinks it's right that the rules were so clearly wrong they should pay back. Cameron has stated he will withdraw the whip from anybody who doesn't do so when requested. There is, to my mind, a HUGE risk that retrospection will become acceptable as the norm (strictly it is, it's only convention that prevents it).

I think it is important to concentrate on the legal argument. I sincerely hope you win. Whatever the rights and wrongs of our legal system it is predicated on (sorry to shout) CERTAINTY AT THE TIME OF ACTION.

I'm just concerned that taking too much stock on MP's whining about the affect on them might be a mistake - because the public feel it is right to hit them backwards.

[Emigre]

[flameproof undies]

Look you filthy tax avoiding scum you're just getting your just deserts.

Actually I don't believe that - but trying to convince the man on the Clapham omnibus is going to be impossible.

DR et al are doing absolutely sterling work, but there is no chance of getting the hearts and minds of the populus at large. Whilst there should not be a moral argument the fact is there is - and it can't be won.

Personally I am concerned about the MP's bleating. Unfortunately the man in the street thinks it's right that the rules were so clearly wrong they should pay back. Cameron has stated he will withdraw the whip from anybody who doesn't do so when requested. There is, to my mind, a HUGE risk that retrospection will become acceptable as the norm (strictly it is, it's only convention that prevents it).

I think it is important to concentrate on the legal argument. I sincerely hope you win. Whatever the rights and wrongs of our legal system it is predicated on (sorry to shout) CERTAINTY AT THE TIME OF ACTION.

I'm just concerned that taking too much stock on MP's whining about the affect on them might be a mistake - because the public feel it is right to hit them backwards.

Any of the major parties making a commitment to "Certainty at Time of Action" would generate widespread support, not just from us but also the whingeing MPs. If UKplc wants to be taken seriously and win inward investment we cannot be seen to offer the risk of retrospective taxation. Simple, the inward investment would not happen, the investor making his investment decision on the basis of today's fiscal framework. He could not quantify the scale of the retrospective hit and would prefer to invest elsewhere in the knowledge that all facts were available to him.

Our situation is different to that of the MPs, from day 1 we were transparent about everything we did, they tried to hide it, admission itself of wrongdoing. Winning the legal battle is the only way to kick retro attacks into touch for the long term. there is a lot riding on it. Any precedent set by our situation would be likely to be used by HMRC for future attacks if they win and as a defense against windfall taxes by banks, oil and gas companies etc if we win.

Flameproof undies are not manufactured in this country, nothing is, and with sterling where it is just now importing would be far to expensive. Watch out for the cheap asbestos varieties...

[PlaneSailing]

[flameproof undies]

Look you filthy tax avoiding scum you're just getting your just deserts.

Actually I don't believe that - but trying to convince the man on the Clapham omnibus is going to be impossible.

DR et al are doing absolutely sterling work, but there is no chance of getting the hearts and minds of the populus at large. Whilst there should not be a moral argument the fact is there is - and it can't be won.

Personally I am concerned about the MP's bleating. Unfortunately the man in the street thinks it's right that the rules were so clearly wrong they should pay back. Cameron has stated he will withdraw the whip from anybody who doesn't do so when requested. There is, to my mind, a HUGE risk that retrospection will become acceptable as the norm (strictly it is, it's only convention that prevents it).

I think it is important to concentrate on the legal argument. I sincerely hope you win. Whatever the rights and wrongs of our legal system it is predicated on (sorry to shout) CERTAINTY AT THE TIME OF ACTION.

I'm just concerned that taking too much stock on MP's whining about the affect on them might be a mistake - because the public feel it is right to hit them backwards.

ASB, I was inclined to agree with you, but I saw a very interesting voxpop
interview on Channel 4 news the other day.

A lady in Gordon Brown's contituency was asked if she thought that what was happening to MPs was fair. She said that it was definitely fair and
whatever they got they deserved.

Then the interviewer asked, 'What if they stuck to the rules as they
were in the past, but now we've changed our minds and we're going to back
date them?'

That was different, and definitely unfair.

I agree that our cause may not be viewed with universal sympathy, but
by the same token, very few right thinking people would disagree with
our case.


(p.s. Has Frank Field's auto responder emailed anyone?)

[ASB]

Any of the major parties making a commitment to "Certainty at Time of Action" would generate widespread support, not just from us but also the whingeing MPs. If UKplc wants to be taken seriously and win inward investment we cannot be seen to offer the risk of retrospective taxation. Simple, the inward investment would not happen, the investor making his investment decision on the basis of today's fiscal framework. He could not quantify the scale of the retrospective hit and would prefer to invest elsewhere in the knowledge that all facts were available to him.

Our situation is different to that of the MPs, from day 1 we were transparent about everything we did, they tried to hide it, admission itself of wrongdoing. Winning the legal battle is the only way to kick retro attacks into touch for the long term. there is a lot riding on it. Any precedent set by our situation would be likely to be used by HMRC for future attacks if they win and as a defense against windfall taxes by banks, oil and gas companies etc if we win.

Flameproof undies are not manufactured in this country, nothing is, and with sterling where it is just now importing would be far to expensive. Watch out for the cheap asbestos varieties...

Damn good job we have one of these.

You are absolutely right about inward investment. I recall a chat on a plane I had. Just after Railtrack had been stolen - I was coming back from Russia at the time and personally unhappy given the size of my RT shareholding. The guy in question said "the money for the PFI hospital is now off the table. Can't do it when there are no rules". Hmm which minister was it that did the Railtrack deed.

If the government does prevail then I'm afraid we are reduced to a banana republic. The size of the slope is huge, the endgame is the law is irrelevant.

[ASB]

ASB, I was inclined to agree with you, but I saw a very interesting voxpop
interview on Channel 4 news the other day.

A lady in Gordon Brown's contituency was asked if she thought that what was happening to MPs was fair. She said that it was definitely fair and
whatever they got they deserved.

Then the interviewer asked, 'What if they stuck to the rules as they
were in the past, but now we've changed our minds and we're going to back
date them?'

That was different, and definitely unfair.

I agree that our cause may not be viewed with universal sympathy, but
by the same token, very few right thinking people would disagree with
our case.


(p.s. Has Frank Field's auto responder emailed anyone?)

I didn't see that broadcast. But I'm heartened by it.

For the avoidance of doubt what scheme users did was "wrong". I use quotes simply to emphasis the "moral" view. The only relevance is was it "legal". I believe it was.

Perhaps I should have had a shorter and less liquid lunch.

[MuddyFunster]

I didn't see that broadcast. But I'm heartened by it.

As I posted the other day, on BBC1's Big Questions on Sunday, only one person who spoke about retrospective law changes supported them. Everyone else said that any retrospective changes weren't acceptable, if what you did was within the rules at the time.

I think it was Alistair Darling who sold off Railtrack.

[smalldog]

In my book the MP's case is nothing at all like ours. Some MP's were purposely screwing the system by claiming for things such as non existent mortgages that had already been paid off.

Others claiming for dubious expenses for cleaning and gardening which in a lot of peoples minds are pure fabrication made even more suspect as they didnt have to produce receipts....

So tell me, how does that have similarity to us, simple it doesnt...

The entire topic is about retrospection. We never deceived anyone, made anything up, claimed anything without substantative proof.

So they are being asked to repay on the basis nobody believes them and in a lot of cases its fraud or at a minimum deceit. We dont fall into either of those categories, we have always fully disclosed everything...

and if Joe Public want a comparable, its like them being told the basic rate of tax is 21p in the pound, only to have it changed a few years later to 24p in the pound and then being hit with a tax bill for all the years they paid 21p...going back, and wait for it 22years to 1987!!!!

so they can stick that in their pipes and smoke it...!!!!

[DonkeyRhubarb]

Retrospective Legislation and Article 1 Protocol 1

In Timms' letter to the JCHR he stated:

"By way of background, this legislation retrospectively clarifies pre-existing anti-avoidance legislation which was itself introduced with retrospective effect."

Unfortunately Timms completely and utterly misses the point. There is nothing wrong per se with retrospective legislation. What we are talking about here is legislation which breaches Article 1 Protocol 1 (A1P1) of the European Convention on Human Rights.

Quoting the JCHR:

A law would be in breach of Article 1 Protocol 1 if it levied a charge in respect of the benefit enjoyed in previous years.

The 1987 legislation to which Timms refers most certainly did not do this. Padmore and a few others, who had claimed the exemption, were allowed to keep the tax that they had withheld. Indeed, they were specifically excluded from the scope of the Act. No-one else received a backdated charge as a result of it. Therefore, the 1987 Act fully complied with A1P1, even though it was retrospective.

s58 breaches A1P1 because it does levy a charge in respect of the benefit enjoyed in previous years.

It is totally irrelevant as to whether s58 is a clarification of previous law because IT (ie. s58) imposes a retrospective charge.

s58 is an Act of Parliament passed in its own right in 2008, which enables a charge to be levied against prior years (2001-2007). Hence by definition this law must be contrary to A1P1.

QED.

EDIT
We must not let the Government or HMRC trick us with a slight of hand. There is a world of difference between:

(1) retrospective legislation which does not levy a retrospective charge or penalty

AND

(2) legislation which does levy a retrospective charge

The 1987 legislation fell into category (1) so was AOK.

BN66/s58 falls into category (2) and is therefore a completely different kettle of fish.

[SantaClaus]

(p.s. Has Frank Field's auto responder emailed anyone?)

Yep, I got an auto-reply from Frank Field. So I emailed him this:



Dear Mr Field,

I read your blog with interest, however I must take issue with one comment you made:

"The charges arising from the closing of tax loopholes, however, are never retrospectively imposed."

I think you need to go back and look at Section 58 of the Finance Act to see that a tax avoidance loophole was closed retrospectively.
Indeed it was Labour MPs who voted this through.

Myself and thousands of other people who used this loophole (completely legally I add) are eagerly waiting for a Judicial Review. This retrospection will cost me personally £150,000 in tax and interest, and bankrupt me. It makes the expenses that MPs will have to pay back look tiny in comparison.

You may also be interested to know that the Joint Committe On Human Rights wrote a scathing report on this retrospective tax and have asked Stephen Timms to justify it. Mr Timms wrote back claiming the legislation was "clarifying" existing law. I wonder if the retrospective change to MPs expenses is also just "clarification"?

This is the link to the JCHR report, which I hope you find interesting:
http://www.publications.parliament.u...3/13304.htm#a5

Regards

Santa

[ASB]

In Timms' letter to the JCHR he stated:

"By way of background, this legislation retrospectively clarifies pre-existing anti-avoidance legislation which was itself introduced with retrospective effect."

Unfortunately Timms completely and utterly misses the point. There is nothing wrong per se with retrospective legislation. What we are talking about here is legislation which breaches Article 1 Protocol 1 (A1P1) of the European Convention on Human Rights.

Quoting the JCHR:

A law would be in breach of Article 1 Protocol 1 if it levied a charge in respect of the benefit enjoyed in previous years.

The 1987 legislation to which Timms refers most certainly did not do this. Padmore and a few others, who had claimed the exemption, were allowed to keep the tax that they had withheld. Indeed, they were specifically excluded from the scope of the Act. No-one else received a backdated charge as a result of it. Therefore, the 1987 Act fully complied with A1P1, even though it was retrospective.

s58 breaches A1P1 because it does levy a charge in respect of the benefit enjoyed in previous years.

It is totally irrelevant as to whether s58 is a clarification of previous law because IT (ie. s58) imposes a retrospective charge.

s58 is an Act of Parliament passed in its own right in 2008, which enables a charge to be levied against prior years (2001-2007). Hence by definition this law must be contrary to A1P1.

QED.

EDIT
We must not let the Government or HMRC trick us with a slight of hand. There is a world of difference between:

(1) retrospective legislation which does not levy a retrospective charge or penalty

AND

(2) legislation which does levy a retrospective charge

The 1987 legislation fell into category (1) so was AOK.

BN66/s58 falls into category (2) and is therefore a completely different kettle of fish.

As ever DR you hit the nail. It is, to me at least, fine to enact retrospective legislation which confers freedom. Hypothetically legislate that burglary is OK and let all the locked up burglars out - I'm comfortable with that (well I'm not, I'm comfortable with the principle).

Personally I'm very disappointed with Camerons stance. It is perfectly acceptable to say any claims which were outwith the rules will be retrospectively disallowed. To suggest withdrawal of the whip for anybody who is not prepared to accept retrospective different rules is unjust. The problem is they will be applauded for it ultimately. Both major parties seem to have the same view. It boils down to "rule 1, there are no rules". Totally Orwellian - but I guess OK if you are Napoleon.

I'm reminded of Niemollers words. You are the current target but if they prevail who is next.