HMRC Consultative Document - marketed tax avoidance schemes

[DonkeyRhubarb]

This was the response to the previous consultation last year.

https://www.gov.uk/government/upload..._avoidance.pdf

2.8 HMRC received 31 responses to the consultation including written
responses and also comments during meetings. A breakdown of the
capacities in which respondents made their comments is below:
* 10 from representative bodies
* 5 from consultants
* 7 from accountancy firms
* 4 from law firms
* 4 from individuals
* 1 from a trade union

I suspect there might be a few more this time !!!

[lara400]

considering I know next to nothing about how any bill is approved - I read somewhere that it needs to go to the House of Commons - so, am I right in saying that it first needs to be approved by MP's and then goes to House of Commons and finally is a passed bill....does this all take a couple of months?

....and then hmrc have to send out letters and then demand a furhter 90 days for the monies...so 6 months for the bill to be passed and then 3 months for the money.....9 months in total?...probably totally off the mark!

[DonkeyRhubarb]

considering I know next to nothing about how any bill is approved - I read somewhere that it needs to go to the House of Commons - so, am I right in saying that it first needs to be approved by MP's and then goes to House of Commons and finally is a passed bill....does this all take a couple of months?

....and then hmrc have to send out letters and then demand a furhter 90 days for the monies...so 6 months for the bill to be passed and then 3 months for the money.....9 months in total?...probably totally off the mark!

The consultation ends 24th Feb. The Government will then decide which proposals will go forward to Parliament in the Finance Bill. These will be announced in the budget next month.

The Bill will then be debated in the Finance Bill Committee in May. If the proposal gets passed then it will become law in July.

So, HMRC could start issuing notices from July onwards with 90 days to pay.

[lara400]

thanks for that

Guess this will be the most anticipated budget to watch then - forget about booze prices going up...

The Chancellor of the Exchequer will give his Budget to Parliament on 19 March 2014

[zaphrus]

Two snippets from me,

Firstly, if contacting non-tory MPs, does anyone think it is worth highlighting how this policy appears to be highly politically motivated, and aimed at securing a fighting fund the chancellor can use as a giveaway ahead of the next election? Add in that the burden of repaying the tax plus interest is going to fall on to a future government, rather than the current incumbent.

I also found this regarding a couple of other pieces of retrospective taxation that reduced the statute of limitation for the taxpayer to claim back overpaid tax.

Tax Analysts -- U.K.'s Retroactive Shortening of Tax Restitution Statute of Limitations Violates EU Law, Advocate General Says

What's interesting is how both were ruled invalid due to the following ...

the advocate general took the position that the key issue is that because the legislation was introduced retroactively and without notice, and with no transitional arrangement offered, taxpayers were caught by surprise and left unable to pursue a claim they had already started.

I think it would make for an interesting discussion with your MP if you were able to highlight that retrospective legislation has been challenged, and ruled against in European courts, and the cost of reimbursing any taxpayers caught by this new proposed legislation will fall entirely on a future government.

[lara400]

all I know is I am not voting Tory's again...

[costo]

Consultation Time

It's interesting that the consultation duration lasted just 4 weeks, according to

Code of Practice on Consultation

Criterion Duration of consultation exercises
Consultations should normally last for at least 12 weeks with consideration given
to longer timescales where feasible and sensible

And then

2.3 When timing is tight, for example when dealing with emergency measures, or international, legally-binding deadlines, or when the consultation needs to fit into fixed timetables such as the Budget cycle, consideration should be given to whether a formal, written, public consultation is the best way of seeking views. Where a formal consultation exercise is considered appropriate and there are good reasons for it to last for a shorter period (e.g. to seek views to inform the UK’s negotiating position on EU proposals soon to be discussed in the Council of Ministers), the consultation document should be clear as to the reasons for the shortened consultation period and ministerial clearance (or equivalent, e.g. in non- Ministerial departments) for the shorter timeframe should be sought. In such circumstances it is important to consider the provision of additional means through which people can express their views.

I'm guessing the provision will be "to get this ready in time for the budget", however I don't believe this was indicated in the consultancy document?

Then

Consultation Principles

Timeframes for consultation should be proportionate and realistic to allow stakeholders
sufficient time to provide a considered response and where the consultation spans all or part
of a holiday period2
policy makers should consider what if any impact there may be and take
appropriate mitigating action. The amount of time required will depend on the nature and
impact of the proposal (for example, the diversity of interested parties or the complexity of
the issue, or even external events), and might typically vary between two and 12 weeks. The
timing and length of a consultation should be decided on a case-by-case basis; there is no
set formula for establishing the right length. In some cases there will be no requirement for
consultation, depending on the issue and whether interested groups have already been
engaged in the policy making process. For a new and contentious policy, 12 weeks or more
may still be appropriate. When deciding on the timescale for a given consultation the
capacity of the groups being consulted to respond should be taken into consideration.

The most important part being

For a new and contentious policy, 12 weeks or more
may still be appropriate. When deciding on the timescale for a given consultation the
capacity of the groups being consulted to respond should be taken into consideration.

Is it possible that this consultancy has not abided by their own framework?

[DonkeyRhubarb]

They may also have wanted to make the consultation as short as possible so very few of the 65,000 intended victims got wind of it in time.

[jbryce]

They may also have wanted to make the consultation as short as possible so very few of the 65,000 intended victims got wind of it in time.

...of these 65,000 - how many are likely to be forced into bankruptcy? Is there any provision for scheme users, who may be hit with several years worth of tax demands, to negotiate substantial 'time to pay' arrangements?
Or is it going to be a train-wreck?

[DonkeyRhubarb]

...of these 65,000 - how many are likely to be forced into bankruptcy? Is there any provision for scheme users, who may be hit with several years worth of tax demands, to negotiate substantial 'time to pay' arrangements?
Or is it going to be a train-wreck?

God knows. The consultation doesn't say anything about what happens if people can't cough up within the 90 days.