Nobody should really have any concerns about HMRC accessing your bank accounts without the permission of a court. That’s a non-story so let’s talk about Take That instead.
The Take That affair quite obviously illustrates that the current law is insufficient to deal with tax avoidance at all.
Yes, the members of the various partnerships were found not to be active partners. And, yes, it was found that the partnerships were not conducting trades on a commercial basis. I’ll also accept that the activities were found to be caught by existing provisions which target arrangements which have the main purpose of avoiding tax. And basically the scheme didn’t work in the slightest at all.
And, ok, the tribunal said that the Ramsay principle would have rendered the tax consequences ineffective even if all that wasn’t the case.
But, candidly, it is a farce that the tribunal had to sit down and consider any of these things at all.
It is an absolute waste of time when a proper anti-avoidance principle like my GRAPIST would have shot down the avoidance scheme at the very instant it was conceived in the perverted mind of a neoliberal tax avoidance professional.
Graham Aaronson’s eponymous GAAR’s ‘double reasonableness’ test is insufficient to deter most tax avoidance activities. Instead, let me remind you of my far superior quadruple questionable test:
If it is questionable that a questionable person might questionably view a transaction as questionable, then it is avoidance and should be taxed however HMRC think appropriate.
If you look at the facts in this case, you will realise the answer to this question is ‘yes’. I managed to establish this beyond any doubt at the very second that I learned that Gary Barlow had donated money to the Conservative Party.
So it would not have taken 147 pages for a Tribunal to establish the pertinent facts, outline the relevant legislation and case law, and arrive at a considered decision taking all of these things into account. It should only take a minute for the liability to be determined and collected directly from Gary Barlow’s bank account.
I see no reason why it should take any longer than that.
Of course, you will have the usual assortment of neoliberals trying to distract from the real issue by suggesting that we can see exactly how HMRC is successfully preventing tax avoidance with the powers they already have and that we currently have a system which gives due process with respect to the rule of law. But this is simply sophistry.
The obvious moral of the Take That case is that we need a GRAPIST.