The next step

[DonkeyRhubarb]

Presumably the listing idea is so that HMR&C can get their 'opinion' on the scheme into law and then take their time pursuing users and purveyors knowing that chances are anyone caught would cough up straight away rather than risk retrospective repayment. I suppose they also think that the list will act as a deterrent.

Retrospective legislation trumps any listing.

The Court of Appeal ruled on the basis that the purpose of the scheme was to obtain a tax advantage and that it misused legislation in a way that was not intended, and it was therefore in the public interest to legislate with retrospective effect.

The ruling could therefore be used to justify closing any tax avoidance scheme with retrospective effect.

Surely, if BN66 was in the public interest, it would be in the public interest to apply the same treatment to all tax avoidance schemes.

If the Supreme Court upholds the CoA it would be pointless for promoters of other schemes to challenge retrospection legislation in the courts on human rights grounds.

The Government could then introduce retrospective legislation without any fear of judicial scrutiny.

[AtW]

The Government could then introduce retrospective legislation without any fear of judicial scrutiny.

Maybe Huitson should have thought about longer term consequences of losing in court before trying to challenge HMRC.

[normalbloke]

They are not dodging it though, they are winning nicely so far in courts and the main problem is that endless appeals trying to prove Black is White actually stall payouts: interest that they currently charge isn't enough to deter such behavior. Hence anti-stalling legislation to increase cost of such action to beat cynical people who'd prefer to appeal and appeal despite being clearly in the wrong.

You can still challenge them in courts, it's just stalling tactics will cost you more in the future which is (in my view) their proposal is all about. I'd take much harsher approach (long jail sentences) if I was tasked with making sure tax dodgers pay the full whack + a lot more on top to deter others, would not you if you had that job?

btw I think taxes are way too high and I'd prefer to pay a lot less than I have to at the moment - it's just I am for tax rates to be reduced for everyone rather than have some people use loopholes to cut down their tax at the expense of others. It's politicians who decide what tax rates are, not HMRC who are just trying to enforce policy.

Point of information here. They may be winning the Human Rights issue (at the moment) which is what the current litigation is all about. It isn't about the law as it stood then. HMRC dodged the courts concerning the actual loophole in the law itself for 7 years.... Why would people affected take HMRC to court when HMRC kept promising they themselves would put test cases before the commissioners? The fact the legal arguments they came up with over those 7 years were nonsense (eg Archer v Baker-Shee) meant everyone was continually waiting for them to come up with a successful challenge. They didn't (or more likely couldn't), hence them getting retrospective change in that law.

So you would put people in prison for not breaking a law as it stood then? No one as yet has proved that any law was broken until it was retrospectively changed. You really are in the wrong country, aren't you.

[AtW]

So you would put people in prison for not breaking a law as it stood then?

No.

What I'd do is that in cases when tax return is successfully challenged and amount of unpaid tax exceeds set threshold (say £10k per year) without really good reason, then it would be classed as tax evasion and jail terms would apply. The bigger the difference between rate at which tax should have been paid and actual paid (say 40% vs 3.5% as an example) the longer jail sentences to discourage "aggressive tax planning".

HMRC will still need to challenge successfully return, meaning going to court if necessary but if you lose there and amounts at questions are very substantial then those who pursued this court of action should not get away with just interest.

Of course none of this is likely to happen ever in this country, that I concede.

Instead what you get is very mild attempts by HMRC to increase cost of stalling tax payments due, that sure beats having to paint Jacqui Smith's house?

[normalbloke]

Maybe Huitson should have thought about longer term consequences of losing in court before trying to challenge HMRC.

You are still confusing the current Human Rights litigation with the original law challenge (which never happened). Huitson et al were saying 'Bring on the Commissioners' in 2001,2,3,4,5,6,7, as they felt HMRC had no legal challenge to the original legislation, despite regular letters saying they did. The overriding impression is that thy couldn't win, so they mislead Parliament into changing the law. Nice.

P.S. Its easy to successfully challenge any return if you change the law retrospectively. So, anyone over your 10K threshold would then go to prison. Hah! Even nicer!

[AtW]

You are still confusing the current Human Rights litigation with the original law challenge (which never happened).

I was referring specifically to "Huitson -v- HMRC" which I believe was the name of the recent case lost in CoA.

[BlasterBates]

One thing to bear in mind is that this is not criminal law, it's civil law. No-one did anything wrong, and no-one is suggesting they did. HMRC are just simply trying to correct their tax returns (in their opinion).

[LisaContractorUmbrella]

Given the demographics of the Commons these days I really couldn't see anything that attacks the use of trusts getting too far , most of them are trust fund babies after all

Unfortunately, regardless of the demographics, none of them will stand up against anything that is seen to be done in the interests of 'fairness'

[AtW]

One thing to bear in mind is that this is not criminal law, it's civil law. No-one did anything wrong, and no-one is suggesting they did. HMRC are just simply trying to correct their tax returns (in their opinion).

Indeed.

They are not bad people, just imagine if I was running HMRC