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HMRC settlements: No sweetheart deals, says Gauke

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‘Wild allegations’ have been made against HMRC for which ‘there is little or no evidence’, David Gauke said yesterday after a Conservative MP said there was a lot of public disquiet about ‘alleged enormous sweetheart deals done with major public companies’.

‘Wild allegations’ have been made against HMRC for which ‘there is little or no evidence’, David Gauke said yesterday after a Conservative MP said there was a lot of public disquiet about ‘alleged enormous sweetheart deals done with major public companies’.

The National Audit Office is to review HMRC’s procedures for settling tax disputes. Last week the Commons Public Accounts Committee said there was ‘little transparency’ for the taxpayer over the way that tax disputes with large companies are resolved, and said it looked to HMRC to ‘co-operate fully’ with the NAO review.

David Davis, the former Home Secretary, asked the Exchequer Secretary to the Treasury when he was going to tell MPs ‘what HMRC has been up to’. Davis complained that he had received ‘a blocking answer’ to a written question about HMRC ‘deals’. He had asked ‘how many companies have had outstanding tax liability of more than £100 million forgiven by HMRC in each of the last five years’.

Gauke pointed out in a written answer, published on Monday, that HMRC does not ‘forgive’ tax. ‘Where a company is unable to meet its tax liabilities HMRC will seek arrangements to obtain the tax. Tax will only be written off when it is clearly not recoverable.’

He added: ‘In seeking to determine tax liabilities HMRC will engage with taxpayers and their advisers to resolve disputes of fact and/or law. Such discussions can be complex and may involve grey areas within the tax system. If HMRC is unable to agree an appropriate settlement it will look to litigation or some form of arbitration. Under its normal rules of confidentiality HMRC cannot reveal details of individual settlements.’

At Treasury questions yesterday, Gauke said: ‘There is no question of sweetheart deals. The reality is that HMRC is seeking to recover as much tax as is due. That is what it has done in a number of cases.’

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