TaxationWeb asks if the Redknapp tax evasion case has really gone as badly for HMRC as first thought.

It's not a good day at TW Towers II, as I sit here nursing what I think is my second Lemsip and, er, water chaser - hey, it's a weekend. This is my third week of what is possibly the worst case of Man-'flu in the western hemisphere. (Thanks, Dad).

To cheer myself up, I am looking at the events of the past few days. We started off the week by giving HMRC a great big slap on the back for doing the right thing over the tax return filing deadline because of call centre strikes - Editorial: Credit Where Credit is Due and then quietly announcing an overhaul (temporary suspension?) of Business Records Checks ( HMRC Climbs Down over Business Records Checks ). Although I do think that if and when tax agents become more familiar with what HMRC euphemistically terms 'leverage', we may have to re-visit the positive score on that last.

And now to what followed. Well, the main headline has to be the most high-profile tax evasion case for many a year - at least for the general public - which did not go too well for dear old HMRC: Own Goal for HMRC? with apologies for the pun.

Yesterday, I found myself discussing the case - arguably a "show trial" - with a practitioner who is closely involved with the Liechtenstein Disclosure Facility. (LDF). Whilst we both agreed that the amount of tax at stake was dwarfed by some of the far more civil settlements that HMRC regularly concludes either through the LDF or not, I found we did not so readily concur on the consequences.

"Certainly they [HMRC] will be very unhappy that the case went against them. And on the face of it they thought they had a strong case." (No argument there). "But don't think all that publicity was wasted: there'll be a good number of people - the kind of people that HMRC wanted to reach - who will have sat up and taken notice. The main point for those people will not be that the case was lost. They will be more concerned that HMRC took the case at all. Not everyone has the stomach for publicity like that."

Well, I have to admit he made a very good point. I recall the statement made by HMRC to the press at the time: "...we would like to remind those who are evading tax... ... that it always makes sense to come to talk to us before we come to talk to you."

So, perhaps not quite the step backwards for HMRC that I'd first thought. But having said that, I still think that the wider public - the vast majority of people in the UK - will look at the cost and consider it wasted money. And that wider, voting public will carry some considerable weight in the minds of politicians who make policy. HMRC can't afford too many more cases like that, I think. Then again, those politicians may also look at HMRC's haul from the LDF (it's not over yet) and conclude that HMRC is actually doing rather well.

Doing well? For two weeks running? Can't be right. Might have to lay off that Lemsip: strong stuff.

Regards all,

TWebEd

ps Assuming lucidity returns, we intend to bring you more on the Liechtenstein Disclosure Facility in the very near future.

Article Added Monday, 13 February 2012 | 226 Hits

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