Tories join Arctic debate

The Tories have waded into the row over the Arctic Systems case, demanding
more information on why HM Revenue & Customs refuses to treat it as a test

Mark Hoban, shadow financial secretary to the Treasury, told Accountancy

that he could not understand why HMRC was refusing to regard it as a
test case and thus paying both sides’ costs.

‘I suspect it really is a test case. I think HMRC is hedging its bets,
depending on how it goes. If it goes against HMRCit won’t be a test case. If

it goes in its favour it will be.’

Hoban stressed that he did not think HMRC should always pay costs, but
that it was unclear, given the amounts of tax involved, why HMRC was pursuing

He added that he would seek more information from HMRC as to why it did not
regard the tax case as testing a particular issue. Geoff and Diane Jones’ legal

costs have beenmet by the Professional Contractors’ Group and other

A spokesman for HMRC insisted that it did not consider it a test case. ‘We
remain of that view,’ he said.

HMRC plans to petition to appeal a Court of Appeal judgment inthe case. It
was refused leave to appeal to the Lords, but it can appeal
that judgment.

The court is now considering the appeal, with some close to the case
predicting a final verdict might not be due until around this time next year,
throwing self-assessment cases into further chaos next time around.

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