Analysis of HMRC's proposals to introduce a new tax penalty regime for tax agents reveal not one, not two, but THREE measures which are directly in conflict with the European Human Rights Act.

The findings, made by Nichola Ross Martin when assisting the ATT tax technical committee in drafting its response to the second stage of the consultation, Working with Tax Agents, the next stage, signals what many commentators had already noted: the arrival of an Orwellian age centering on a lack of transparency between HMRC and agents and a fundamental mistrust.

Article 6: the right to a fair trial
This applies to criminal proceedings. HMRC downplays the offence of agent fraud by creating a new civil offence of deliberate wrongdoing. This ensures that the agent no longer has the presumption of innocence or the right to a fair trial. HMRC proposes that the agent cannot attend a hearing to defend himself.

Article 10: the right of freedom of expression
HMRC proposes that anyone who directly or indirectly assists another person with their tax affairs will be treated as a tax agent and penalised, if it is discovered that anyone reduced their tax bill as a result of the advice. Giving "assistance" can take the form of any advice, paid or unpaid. This means that the proposed legislation will censor anyone discussing any form of tax planning in public and using any media. The definition also applies to voluntary organisations, broadcasters and presumably to HMRC’s officers and employees, past and present.

Protocol 1, Article 1: the right of Protection of Property
HMRC's penalty proposals do not have reasonable relationship of proportionality between the means employed and the aims pursued. Proposed levels of fines are set, but not in reference to any tax loss. In fact no tax loss is required in order to levy a fine.

Nichola commented, "Someone clearly has a chip on their shoulder to invent this set of proposals. It seems that these measures are intended to apply to anyone who dares mention tax planning in the future."

"The proposals will also hit advisers in all shapes and forms (including HMRC's helplines) if they dare mention that a relief or expense can be claimed. It is difficult to see how anyone will be able to assist anyone with their tax affairs if this goes through."

Respond now: HMRC's consultation Working with Agents.

 

 

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