Big Four grilling: A modern Star Chamber

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On 31 January the heads of tax of the Big Four accountancy firms will appear before the Public Accounts Committee, which seems to be intent on reinventing itself as a modern Star Chamber though without the option of the headsman’s axe, says Simon Sweetman.

Quite how the PAC morphed into the modern equivalent of Stalin’s show trials I am not sure, but it seems to have that role now, though liquidation of individuals rather than companies seems not to be on the agenda. It is something to do with the fact that MPs, having no real individual power, enjoy the chance to throw their weight around a bit.

These suspects are being asked, it seems, to distance themselves from complex and artificial tax avoidance schemes, or explain how they don’t do that sort of thing (just introduce clients to the people who do). Doubtless they will all express their shock and horror that anyone should think so poorly of them.

Will this be a turning point in government attitudes to avoidance? Or will it just be an opportunity for MPs, already frothing about Amazon and Starbucks, to showboat about their distaste for tax avoidance without actually having to do anything about it? So far there has been a great deal of posing about and expressions of disgust but little in the way of concrete proposals. At Davos David Cameron “laid into” corporate tax avoidance – but what is he going to do about it (apart from slashing HMRC’s staff)?

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29th Jan 2013 14:39

Are we *still* playing Buzzword Bingo ?

"and (more often) exceedingly wealthy individuals "

OK, Simon probably isn't on the editorial team ...

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01st Feb 2013 12:50

One Show

and congratulations to Richard Murphy for a great piece on the One Show last night to make all this ever so slightly accessible to the masses. He successfully managed not to be upstaged by Rob Brydon, which was an achievement in itself!

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By chatman
03rd Feb 2013 20:52

Star Chamber

The Star Chamber was an English thing; it had nothing to do with Stalin.

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04th Feb 2013 13:41

Star Chamber

Stalin didn't even bother with a Star Chamber. The PAC is not entirely similar as it has no sanctions, if you don't give into bullying by gluttonous publicity seekers. I don't want to be taxed by Hodge and Murphy although in fact despite all the bluster and whingeing neither specifies exactly what their alternative tax system would look like. I don't really want to be taxed by the establishment, Eton Christ Church and the Guards, and judges who have never travelled on a bus who interpret Finance Bills rammed through without effective opposition (though now with at least a degree of prior consultation).

HMG has just enacted pages of new CFC legislation which if enacted by a tax haven it would have damned as harmful tax competition. Much of it is designed to attract overseas groups here on the basis of low tax like the non-resident finance subsidiary with an exemption or effective UK tax rate of 25% of the main CT rate. What do Hodge and Murphy make of that? This is Government sponsored tax avoidance. Pass the port.

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