UK Uncut threatens High Court action over Goldman Sachs

ACTION GROUP UK Uncut has threatened legal action over HM Revenue & Customs’ deal with Goldman Sachs over National Insurance contributions.

The group called for permanent secretary for tax Dave Hartnett to stand down at a protest last week. On Friday, it said it would look into the possibility of obtaining a High Court ruling on the deal. A statement from UK Uncut said that the deal was unlawful because HMRC departed from its governance procedures.

The deal centres around the bank’s use of employee benefit trusts. A court ruling in 2005 declared that companies using the trusts, which provide non-repayable loans to employees, must pay National Insurance on the loans. While 21 companies paid the bill, Goldman Sachs challenged the ruling and was reportedly told it will have to pay interest while the dispute was ongoing.

However, in 2010, Hartnett agreed a deal that meant the bank did not have to pay the interest. National Audit Office head Amyas Morse said that the Treasury had lost up to £8m through the deal. Hartnett claimed that HMRC had, in error, believed that it was unable to recoup the full amount.

In its blog, UK Uncut said: “If it was a genuine mistake, then it can be rectified and the money paid back. And being the reasonable people that we are, we have given them a couple of weeks to do so. If not, though, we will see them in court, as we believe that this handshake agreement is unlawful because, reportedly, Dave [Hartnett] didn’t follow HMRC’s own procedures. So if it’s not quashed, Dave’s dodgy deal could land him in the dock.”

(Photo: Jaimie Kaffash)