TaxAdministrationRevenue slammed over property ‘cock-ups’

Revenue slammed over property 'cock-ups'

The Inland Revenue has been accused of 'the most extraordinary catalogue of cock-ups' after admitting they signed up to a deal involving the transfer of properties to a company based offshore.

Link: Investigation looms over Revenue property deal

Liberal Democrat shadow chief secretary David Laws delivered the attack after the Commons Treasury Committee cross-examined Inland Revenue chairman Sir Nicholas Montagu about the arrangement during an inquiry into the sale and leaseback of their portfolio of 600 buildings with Bermudan-registered Mapeley Steps.

Montagu admitted the Revenue falsely claimed at the time the deal was with UK-registered Mapeley Ltd.

And the Revenue made the position worse by writing a subsequent letter to the company, when Mapeley revealed it was in financial difficulty, in order to reassure the company’s shareholders.

The letter was subsequently ruled to be a possible ‘letter of comfort’ which could mean that if the deal turns sour and the company defaults, taxpayers will have to pick up any losses.

Laws said later it was clear the Revenue and Customs & Excise, who participated in the deal, had accidentally put themselves in a positionwhere they had effectively underwritten the financial risks in a deal with a company in an tax haven.

In a statement to the committee, Montagu said ministers were not told at the time the contract was signed in 2001 that the company was registered in Bermuda.

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