Big Four at the PAC: Replay
Parliament TV provided riveting viewing on Thursday morning as the heads of tax at the UK's Big Four firms testified before the Public Accounts Committee (PAC).
KPMG head of tax Jane McCormick, head of tax policy at Deloitte, Bill Dodwell, PwC head of tax Kevin Nicholson and Ernst & Young head of tax John Dickson faced the wrath of PAC chair Margaret Hodge and her colleagues as the anti-avoidance atmosphere reaches fever pitch.
Many accountants who spent the day wrestling with last-minute tax returns can still tune in to the re-run, and review what watchers made of the proceedings via comments on Twitter.
It was a bruising encounter, described by ICAEW staffer Sarah Buckley as an example of how under-resourced select committees struggle to grasp complex issues like tax law. "It's theatre, not scrutiny," she tweeted.
"Epic stuff," added Rebecca Benneyworth, who was full of praise for how the profession's representatives conducted themselves in the face of questioning that suggested they were lying and that secondments to central government impugned their independence. "An object lesson in how little politicians understand about tax and business, and in moderation and patience from Big Four," Benneyworth added.
At the same time, the committee forced the firms to acknowledge their roles in advising some of the corporations that have been in the spotlight before the committee for "immoral" tax avoidance.
Jeremy Newman said on Twitter: “The Big 4 partners behaved amazingly well in the face of outrageous levels of provocation, IMHO”
ICAEW boss Michael Izza also called for the committee to stop undermining the profession: “I was disappointed to again hear our profession being misrepresented as tax avoiders by a UK parliamentary committee today,” he said in a blog post following the session.
The One Show
While many in the profession disagree with Richard Murphy’s stance on tax, the sight of him cosying up to Rob Brydon on the One Show sofa to discuss tax avoidance and the PAC session on Thursday evening should send shivers down the spines of those who oppose his views.
Murphy’s primetime appearance and the surge in political and popular opposition to tax avoidance are signs that the profession could be losing the battle of public opinion.
Murphy said the PAC session “didn’t land any big punches”, but claimed it confirmed his assertion that these big firms do sell tax avoidance: “It took two hours for them to admit it. We also learnt that they’ve got so many branches in tax havens that one of their partners didn’t even know where his firm had offices and had to be reminded.
“As well as selling tax avoidance, they’re helping write the law for the government,” he said.
PAC chair Margaret Hodge also appeared on the One Show and said that despite not having specialist tax knowledge, she always makes sure she’s done her preparation.
With reference to tax advisers writing the law for the government, Hodge said it was a case of “poacher turned gamekeeper and then back to poacher again”.
- Simon Sweetman: Big Four grilling: A modern Star Chamber