Zac backs calls to halt the hated Loan Charge

Richmond Park and North Kingston MP Zac Goldsmith has put his weight behind a cross-party campaign calling on the Government to stop HMRC’s Loan Charge policy, which threatens the livelihoods of thousands of ordinary taxpayers across the UK.

The 2019 Loan Charge, which has just taken effect, gives HMRC the power to charge large sums to recover tax avoided by individuals who were paid through loans which were designed never to be repaid. Critics of the Loan Charge argue that it is retrospective taxation, which punishes self-employed contractors who acted in good faith by using recommended schemes.

Zac joined with MPs from all the main political parties as he spoke in a House of Commons debate on the issue and added his name to a letter to Treasury Minister Mel Stride calling for a delay to the Loan Charge whilst an independent review on its fairness is carried out.

Addressing MPs, Zac criticised the way that HMRC has treated those affected, saying: “Some of HMRC’s language seems totally tone deaf. Its factsheet says that it has ‘no desire to make things difficult for taxpayers, and will always take a fair and even-handed approach to those who genuinely want to settle their affairs.’ That is the opposite of the experience of some of my constituents who, based on good faith and professional advice, are being punished retrospectively and face utter ruin.”

Commenting afterwards, Zac said: “I support the Government’s efforts to raise more money from tax evasion and avoidance, but the Loan Charge targets the wrong people for the wrong reasons. It is a basic issue of fairness that people should know what tax they are expected to pay at the time they are expected to pay it – clobbering people years later with a new law is a gross violation of that principle. To add insult to injury, most of the constituents I’ve met to discuss this were advised to use these schemes by the companies and public bodies that paid them. It’s time for HMRC to chase after the real tax dodgers and leave these people alone.”