Is today a publicly humiliating one for HMRC?
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The failure of HMRC to actually obtain a guilty verdict for Harry Rednapp and Milan Manderich has shown that despite all of the evidence that HMRC felt they had, which incriminated them, it has resulted in both men walking free.
The investigation, which has lasted for 5 years and the court case has cost an estimated £8 million in tax payers money, whilst chasing a sum of about £100,000 in alleged tax avoidance.
But perhaps the weakness of the HMRC case was highlihted last year when in a closed trial in order not to prejudice the outcome of the pending case of Rednapp and Manderich, another senior person of the Portsmouth Football Club, Peter Storie, who was also charged with a similar tax avoidance offence was also found not guilty.
If the HMRC were to pursue the Corporate entities, who avoid considerable tax payments through creative accounting and off-shore financial dealings with as much vigour as they have this case, then perhaps the country wouldn't be in such an economic mess. Perhaps if all ministers of all political persuasions were to pay their fair share too, then this would encourage others to do the same. (I know a bit of a long shot!)
The HMRC have been shown to, through their silence and lack of action, to side with big business. If they were to apply due process to all businesses and individuals then we would have a fairer system.
As the HMRC stood on the steps of Southwark Court this afternoon, they attempted to place a gloss on the loss of their action, by saying that tax avoidance is a serious matter and the HMRC will pursue and challenge all those whom are intent on defrauding each and everyone of us, as taxpayers.
I applaud their sentiments but as this case has shown, often more money is spent on the pursuit then the ability to recover any lost revenues.
Responses (5)
Quite right Parchy. As they say 'fine words butter no parsnips'. Sadly HMRC employees seem to be thoroughly demoralised for the most part. Inspectors who are good at their jobs are apt to be poached by Accountancy Firms or large Corporations to help them devise tax avoidance strategies.
Sadly this makes for yet another Department that's 'not fit for purpose'.
HMRC management are insane. Before any action is taken, they need to see if the amount recoverable would pay for their costs in the event they lost and if so, should not pursue the case.
And I agree, they should go after the big fish with deep pockets: corporations and multi-millionaires.
Of course, then HMRC would actually have to understand the tax system and - worse - do a lot of hard work.
So that'll never happen...
You bet that it is a gross public humiliation for HMRC. To put it bluntly,If you use up such vast £ millions in public funds to fight a case HMRC should have made sure that they had a more than 70% of success. The fact that they had known and this was only revealed to us today that HMRC had already lost a similar case in prosecuting the same Mandarich and former high rank officer Peter Storrie at Portsmouth FC in late 2011 (2 men closely linked to Redknapp whilst at Portsmouth) this was a spectacular own goal from HRMC to force this case to court. They have no responsiblities for public management of finances. If you add the 2 cases together plus the costs of the other parties it probably comes to much more than £8Million.
When we started this discussion, I said that I wanted to say "Hooray for Harry", but thought you might think badly of me.
So I will shout" Hooray for Harry" right now.!
I know that the Inland Revenue have a job to do, but sometimes they are a little `over confident`. without good cause.
totally agree with you - what a waste of money! - an element of it because he is high profile too. Also 8 or so million vs less than 200k which is what the case was about...
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I've never heard that expression 'fine words butter no parsnips' but love it!
Parchester, this is an ancient phrase dating back hundreds of years. I remember my mother using it and am glad to be reminded of it by AlwynP
Most days I think to myself, 'Chatting in this Forum is not buttering any parsnips!'
My mother used to say it too.