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Goldman Sachs’ HMRC tax deal to face judicial review

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Tax avoidance campaign group, UK Uncut Legal Action, has been given permission to challenge the conclusion of a tax dispute between Goldman Sachs and HM Revenue and Customs (HMRC) that the campaigners allege cost the UK millions of pounds.

A High Court judge ruled the group had “an arguable case” that should go to a full judicial review hearing after its lawyers claimed HMRC failed to carry out its legal duty to renegotiate a deal with the bank after it emerged the government had a mistake in the original talks.

This news came a day before the National Audit Office (NAO) released a report stating that taxpayers are at risk of not getting the best deal when it comes to negotiating a tax settlement with HMRC, highlighting flaws in the tax authority’s governance procedures.


Concerns were raised last year by a HMRC whistleblower about a settlement made by the tax authorities with Goldman Sachs over a tax avoidance scheme used by the bank to pay its staff.

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The Comptroller & Auditor General, the head of the National Audit Office, which scrutinises public spending on behalf of Parliament, told a parliamentary committee that a mistake in the calculation of the interest bill, which HMRC has admitted to, resulted in a loss of £8 million ($12 million) for the exchequer.

However, a whistleblower told the committee that the interest due on the settlement could have been up to £20 million.

UK Uncut Legal Action has accused HMRC officials of giving the bank a favourable deal. The group claim these accusations can be backed up by HMRC’s internal minutes from December 2010 which showed the involvement of Dave Hartnett (pictured below), permanent secretary for tax at HMRC, in the agreement which allowed the bank to repay only the amount owed.

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UK Uncut will now be allowed to bring a full hearing for judicial review of the agreement and could lead to HMRC disclosing internal and confidential documents about the settlement.

Murray Worthy, director of UK Uncut Legal Action said: "There is overwhelming public support from unions, NGOs, MPs and thousands of ordinary people who want to see this dodgy tax deal challenged in the courts. It shows the deep level of outrage that people feel over state sanctioned tax dodging by big business, while the government destroys public services that ordinary people rely on, saying that there is no money.”



 

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