Friday 27 July 2012

HMRC Publish Photo of Plumber

Three days ago I wrote:
"David Gauke has said that the government will name and shame wealthy people who use "aggressive" tax avoidance schemes."
Well blinkey blonkey blimey, a mere three days later and HMRC have named, shamed and published a photo of a taxpayer who has been found guilty and sent to jail for a year for tax evasion (£50K or thereabouts).

This was of course tax evasion (ie a crime) and, as such, jail etc is the probable/possible outcome (depending on the severity of the crime etc).

However, I am a tad perturbed though that HMRC were so keen to not only name and shame him but also publish his photo. Whilst a criminal does not usually have the right to anonymity, it seems a tad hypocritical of HMRC given that they keep banging on about taxpayer confidentiality when it comes to Vodafone et al.

Oh I didn't mention what the tax evader did for a living, he's not banker or such but a plumber (hence, probably, Gauke is so excited about cash in hand as he sees a soft target).

It is "ironic", is it not, that some criminals have their identities protected (lest their human rights or safety be threatened), yet HMRC happily publish the picture of a plumber?

Funny old world!

In other news, Barclays have today said sorry for rigging Libor and have announced that underlying first-half pre-tax profits rose 13% to £4.23BN.


So all is right with the world, yes?

Tax does have to be taxing.

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    Executive Summary

    4. These comments by the Treasury Committee (Administration and effectiveness of HM Revenue and Customs Sixteenth Report of Session 2010–12 HC 731) provide a good background to this matter:

    “159. A particular source of controversy has been HMRC’s settlement of large tax cases involving corporations. Allegations have been made in the press that cases have been settled inappropriately for a lower yield than might have otherwise been achieved. We pressed HMRC witnesses and the Minister on whether the appropriate processes had been used in two high-profile cases. Dave Hartnett, the Permanent Secretary for Tax, vigorously defended the procedures that had been used to achieve a settlement with Vodafone and argued that figures cited in the press lacked credibility. HMRC said they were unable to comment in relation to another high-profile case for reasons of taxpayer confidentiality…

    160. We are not in a position to judge whether individual cases were settled appropriately or not. Nor are we challenging the need for taxpayers’ affairs to be kept confidential. However, the sums involved in some of these cases are enormous. …

    161. The National Audit Office has undertaken work on HMRC’s procedures for resolving large tax cases, whilst the Committee of Public Accounts has already recommended that “the Department should consider the scope for increasing transparency in the area of large and complex tax cases and for assuring Parliament and the public that due process in the resolution of these cases is being followed.”

    162. The Exchequer Secretary did not believe it would be appropriate for politicians to be involved in settling individual tax cases. However, he was concerned that the current process did not allow HMRC to respond to allegations against it:

    “We have to remember that some of these allegations question the integrity of dedicated public servants on the basis of little or no evidence, and it concerns me that some of these decisions are becoming politicised and it is quite difficult for HMRC to answer back because they are not entitled to put confidential information into the public domain.”

    163. The public needs to be assured that cases involving large sums of money are being settled correctly. Equally it is unfair on HMRC staff and damaging to public confidence that the Department can be the subject of repeated allegations it cannot refute, even if they are groundless. We agree with the Committee of Public Accounts that HMRC should consider how the accountability and transparency of the settlement of large and complex tax cases might be improved. We are taking further evidence on how this might be achieved.”

  2. 5. It is inaccurate and misleading to assert that rules of confidentiality prohibit HMRC from discharging its duties of transparency and accountability to Parliament and the public. Section 18(1) of CRCA 2005 enacts the general duty of confidentiality in these terms: “Revenue and Customs officials may not disclose information which is held by the Revenue and Customs in connection with a function of the Revenue and Customs.” However, this duty is subject to numerous exceptions provided in subsections (2) and (3) of section 18.

    6. One of these exceptions is section 18(2)(a) which provides that the duty of confidentiality under section 18(1) “does not apply to a disclosure which is made for the purposes of a function of the Revenue and Customs, and does not contravene any restriction imposed by the Commissioners.” Section 51(2) defines “function” for these purposes as “any power or duty (including a power or duty that is ancillary to another power or duty”, while section 9 authorises the Commissioners to “do anything which they think necessary or expedient in connection with the exercise of their functions, or incidental or conducive to the exercise of their functions”.

    7. HMRC routinely issues press releases (also published on its own website) disclosing sensitive personal details of individuals convicted of (and sometimes charged with) tax and benefit offences. A recent press release issued shortly after the evidence by the Exchequer Secretary to the Treasury Sub Committee (referred to in paragraph 4 above) is as follows:

    Disability tax credits cheat jailed—23 May 2011

    A mother who faked her children’s disabilities to steal £112,000 in tax credits which she spent on tickets to see boy bands and stars of the X Factor was jailed for two years today.

    Jayne McKnight, 45, from Wolverhampton, began claiming tax credits in 2003, stating that one of her four children was severely disabled. During the course of the fraud she increased this to three severely disabled children, and added a severely disabled and unemployed husband, whilst claiming she was working part-time for a temping agency. At the same time, McKnight claimed thousands of pounds in childcare and after-school club costs.

    HM Revenue & Customs (HMRC) investigators uncovered neither her children nor her husband were disabled. Mr McKnight was in fact employed by a local newspaper, and the temping agency where Jayne McKnight claimed to be employed had never heard of her. Finally, she had never even contacted any of the childcare providers she claimed tax credits for, and her children had never attended any after-school clubs.

    David Gauke, Exchequer Secretary to the Treasury, said:

    “The Government will not tolerate dishonest people stealing public money which pays for vital services. Those who think they can cheat the benefits system should think again. The extra £900 million we have invested in HMRC allows them to step up the fight against benefit cheats and tax fraudsters.”

    Notes to editors1. Defendant’s details:* Jayne McKnight, DOB 9/2/1966, of 107 Owen Road, Wolverhampton, pleaded guilty to being knowingly concerned in fraudulent activity with a view to obtaining payments of Tax Credits contrary to Section 35 of the Tax Credit Act 2002.2. Sentencing took place at Wolverhampton Crown Court.

  3. 8. It should be noted that the general duty of confidentiality under section 18(1) of CRCA 2005 applies to any information held by HMRC in connection with any of its function, including information that may be in the public domain already. As the availability of information in the public domain is not an exception to the duty of confidentiality a specific gateway is required to issue these press releases lawfully. HMRC applies section 18(2)(a) which permits a disclosure made for the purposes of its function. The Commissioners consider that the duties of transparency and accountability HMRC owes to the general body of taxpayers override any duty of confidentiality it owes to the individual customers concerned; and that in these circumstances such disclosures constitute a lawful interference with the rights of the affected customers to private and family life under Human Rights legislation.

    9. The Commissioners are well aware that section 18(2)(a) of CRCA 2005 similarly authorises the disclosure of information about corporate customers involved in controversial settlements to Select Committees of the House of Commons that have oversight functions over the Department, such as the Committee of Public Accounts and the Treasury Committee. As the recent controversy surrounding the Vodafone and Goldman Sachs settlements shows, such disclosures are clearly necessary in order to assure Parliament and the public that cases involving large sums of money are being settled appropriately.

    10. However, the Permanent Secretary for Tax, Mr Hartnett, who has the effective delegated authority to exercise the Commissioners’ power to forego the collection of tax for reasons of good management and also has the sole delegated authority to exercise the Commissioners’ power to withhold information for reasons of taxpayer confidentiality (including information relating to settlements he has been involved in) has effectively ensured that relevant information about these settlements are withheld from Parliament and the public.

  4. Has a body corporate the same rights as a human being under CRCA, RIPA or HRA?
    Do we need a reinforcing of "In the public interest"?
    Do we want a monolithic system that is so tranparently biased as HMRC is?
    There are so many of them in bed together its a wonder it hasn't collapsed!

  5. They've released his name and photo because he's been convicted of a criminal offence and is therefore in the public domain. The head honchos at Vodafone, Goldman Sachs etc weren't convicted or even brought to trial so they don't get their photos in the papers. The question of whether they SHOULD have been brought before the Courts is, of course, an entirely different matter...

  6. These photos`s are actually available, upon request from the Press Office, once a conviction is obtained.

  7. HMRC like to keep quiet about the criminal prosecutions they lose and there are a lot more of them than most people realise. The Redknapp case was just the tip of a very big iceberg. Many don't even make it to full trial because the Departments f*cks up so many cases in advance. When I worked for the Department many years ago its legal teams were a bit of a joke. I don't suppose that has changed in the intervening period. One of the reasons HMRC goes after small fry is because if it takes on a big Corporation or wealthy individuals it is 99% certain that the defendants solicitors and barristers will make mincemeat of them in court. As a consequence HMRC like most bullies tends to pick on the smallest kid in the playground. It is shameful behaviour from a body that is supposed to represent the public interest.

  8. EXCOM and the rest of the croneys should maybe heed the words of the big fella and let he is without sin cast the first stone

  9. As ever, the aroma of the bog of eternal stench surrounds the ongoing debacle that is HMRC. Making up the rules as you go along is all part of the role play, they don't have to worry about cost as its an endless supply of customers money, although it does appear that the title TAXPAYER is coming back into vogue. I wonder why, was it something written on a Pacesetter board, something from a dungeons and demons idea or just common sense? No, sorry, forget the last one!
    The big fella (one area that equality has yet to reach) and the geeza wot stands at them pearly gates are sure to be having a busy time turning back the hordes that have swallowed hook, line and sinker, the immoral approach of the greedy. One of the biggest failings of present time in relation to responsibility in public office is the manifestation that is HMRC, and it is nothing short of a disgrace.
    However, leaving Christianity to one side and looking at older beliefs - Karma will be their downfall. It's just a pity that these hypocrites don't have any sense of responsibility or shame.
    And for the dyslexic atheists amongst you, always remember, there is a dog!
    LOL ;-)

  10. HMRC needs another whistleblower. It is difficult, I know, given the treatment the last guy got - but that tells you everything - they are scared to death. So are National Audit and all others who were supposed to be responsible for the department because it has been a law unto itself for a long long time now.
    There are so many skeletons in cupboards the place rattles. From nepotism in promotions and transfers to the private sector, through high level board members using tax evasion schemes, to senior staff leaving and returning, days later, employed as a private company etc. etc. The Deepak Singh fiasco has most of it - it has been covered by Ken and here by the Daily Mail - if link is allowed?
    And now HMRC is investigating other departments - you could not make it up.

  11. Much more of this and parliament is going to have to do something constructive about the numerous issues.
    Perhaps a good place to start Ken would be this site asking loyal readers to send in notification of areas of shame, don't need specific details, just the threads.
    I bet if this was done one or two fence sitters might make the right, honourable choice.
    A lot of the statistics are held within HMRC databases and kept far from prying political eyes, blind NAO members and the unions.
    A good start would be taxpayer confidentiality and public interest, get it ruled upon by the legal system openly.
    BTW, why are we taxpayers when it comes to confidentiality and customers for the rest of the year?
    The worst is yet to come!