Who came up with that cunning plan?
Recently, I was doing a little research and came across a recent public accounts committee report on HMRC; and to quote the chairman, HMRC have scored “a massive own goal”. When I read further with increasingly incredulity, I began feeling a mixture of amusement and anger.
For 12 years HMRC has contracted an off-shore company, Mapeley STEPS Contractor Ltd, to manage two thirds of its properties. Mapeley is owned by a US hedge fund with its directors being registered in Bermuda and because it’s based off-shore it is sheltered from UK taxation.
Thus HMRC’s landlord, which has a contract to 2021, worth at least £4bn, and currently running most of HRMC’s offices, is not paying tax. The Revenue has been publicly raging about offshore tax havens and tax avoidance, but cannot collect taxes without using buildings benefiting from tax avoidance.
Tax experts have estimated that Mapeley’s tax offshore savings from their HMRC deal has to date, been worth upwards of £50m and the total saving over the life of the contract is likely to be in excess of £100m. HMRC’s pathetic justification to the committee for the deal is that it saves money for the taxpayer; which beggars belief as they’re effectively writing off £100m.
I don’t know about you, but a smell a strong whiff of hypocrisy in the air!
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David Jones is the Senior Partner and Founder of Morgan Jones & Company. Born in Liverpool and an Accountancy graduate of the University of Wolverhampton, David spent twenty years working for the Customs & Excise in London then Shrewsbury before starting his own business. David's depth of knowledge of the UK tax system and his ability to communicate this learning has seen Morgan Jones & Company grow into Shropshire's most respected Accountancy Practice.