Regulators urged to examine UK business dealings with Bangladeshi ex-minister

HMRC and FCA asked to look into property deals with Saifuzzaman Chowdhury now under investigation for corruption in Dhaka

British regulators have been urged by MPs to examine the relationship between London estate agents, lawyers and lenders and a former Bangladeshi government minister under investigation for alleged corruption.

Saifuzzaman Chowdhury was the land minister in Bangladesh until earlier this year, when the government of Sheikh Hasina was spectacularly toppled, after her regime’s violent suppression of student protests.

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Doubts grow over Labour’s VAT plan for private schools

The Treasury refuses to confirm 1 January start date as unions, tax experts and school leaders say it is unworkable

Government plans to impose VAT on private schools from 1 January next year may have to be delayed because of warnings from unions, tax experts and school leaders that meeting the deadline will cause administrative chaos and teacher job losses, and put pressure on the state sector.

The Treasury on Saturday night refused to confirm that the plan to impose 20% VAT on private school fees would go ahead from 1 January, as confirmed by the chancellor, Rachel Reeves, in July, instead saying it would be introduced “as soon as possible”.

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Nadhim Zahawi’s lawyers ‘breached code to stifle HMRC revelations’

Former chancellor’s solicitor accused of breaching code of conduct by threatening legal action against tax campaigner

Nadhim Zahawi instructed his lawyer to threaten legal action against a tax campaigner who helped reveal that the then chancellor was under investigation by HM Revenue and Customs, according to a tribunal document.

Zahawi’s solicitor, Ashley Hurst, is accused of breaching his regulator’s code of conduct by attempting to prevent Dan Neidle from publishing correspondence threatening legal action over the tax expert’s revelations about the then Tory leadership candidate.

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Tory donor Lycamobile handed winding-up order from HMRC amid tax dispute

Pay-as-you-go simcard seller often filed late returns, had accounts queried by auditors and was embroiled in eight-year VAT battle

Lycamobile, a telecoms company that has given more than £2m to the Conservative party, has been issued with a winding-up petition by HM Revenue and Customs, amid a long-running VAT dispute.

The company, founded by businessman Allirajah Subaskaran in 2006, sells pay-as-you-go sim cards that are popular with low-paid workers wanting to make cheap phone calls to family overseas, as well as in the UK.

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Call waiting times at HMRC rise 350% in five years, says NAO report

Report from public spending watchdog comes soon after similar data from parliamentary committee

Average call waiting times at HM Revenue and Customs have soared by more than 350% in five years, with increasing numbers of people not getting through in the first place or having their calls terminated, according to an official report that says the public is being “let down”.

The National Audit Office (NAO) said the quality of customer service provided by HMRC had been “far below” the levels expected in recent years, and that its phone lines in particular were “not delivering”.

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Work and pensions committee chair tells ministers to fix carer’s allowance issues

Stephen Timms says DWP letting unpaid carers incur ‘enormous accidental overpayments’

Ministers have been told to “immediately” fix the issues causing tens of thousands of unpaid carers to incur “enormous accidental overpayments” amid growing anger over the carer’s allowance scandal.

Stephen Timms, the chair of an influential parliamentary committee, said he was “very troubled” that scores of carers were being forced into financial distress as a result of the government’s mistakes.

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Treasury disbanded non-dom tax policy unit weeks before budget, sources say

Exclusive: Officials fear government is ill-prepared for lobbying from wealth advisory industry after taxation overhaul

The Treasury disbanded a unit tasked with offshore and non-dom tax policy weeks before announcing significant changes in the budget to the way foreign residents are taxed, sources have said.

The unit, which comprised technical experts on offshore tax issues, included specialists on non-dom policy. These officials would, according. to the sources, have been expected to help manage the implementation of a replacement for non-dom status as outlined by the chancellor this week.

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HMRC struggling to cope as customer service levels hit ‘all-time low’

New report notes ‘continued decline’ and rising call-waiting times as ‘fiscal drag’ pulls growing numbers of people into an ailing system

Customer service levels at HM Revenue and Customs have sunk to an “all-time low”, parliament’s spending watchdog has said.

Users regularly encounter long call-waiting times as the tax department apparently struggles to cope with demand, a report by the cross-party public accounts committee (PAC) has found.

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HMRC investigations of wealthy ‘tax dodgers’ halve in five years

The drop in civil inquiries by fraud unit sparks criticism that the authority’s use of its powers of enforcement are waning

The number of civil investigation cases opened by a HM Revenue and Customs (HMRC) fraud unit investigating offshore, corporate and wealthy taxpayers has fallen by more than half in five years, figures reveal.

The Observer reported last month that HMRC has not charged a single company under landmark legislation to crack down on tax evasion. Campaigners warned that HMRC was undermining its own deterrents by failing to use its criminal enforcement powers.

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Fujitsu won £1.4bn in new government contracts after court ruling on Post Office software bugs

MPs find Treasury-affiliated bodies have engaged Horizon firm since damning 2019 high court judgment

The Japanese technology company Fujitsu, whose flawed technology for the Post Office led to the wrongful prosecution of hundreds of subpostmasters, is confirmed to have held contracts worth more than £3.4bn linked to the Treasury since 2019.

Figures published by the Commons’ treasury committee show £1.4bn of contracts were awarded to Treasury-affiliated organisations after a high court ruling in December 2019 over the company’s software. The judgment found that “bugs, errors and defects” in Fujitsu’s Horizon system could cause shortfalls in Post Office branch accounts.

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HMRC has not charged a single company over tax evasion under landmark legislation

Powers bestowed by the Criminal Finances Act 2017 are not being used effectively, say critics

HMRC has not charged a single company under landmark legislation passed six years ago to crack down on corporate tax evasion.

Critics say the data, released under freedom of information laws to the Bureau of Investigative Journalism and TaxWatch, suggests that HMRC is undermining its own deterrents against corporate tax evasion by failing to use its criminal enforcement powers.

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Fujitsu government contracts under scrutiny in light of Horizon scandal

Treasury committee writes to 21 bodies including Bank of England and HMRC to demand details of post-2019 deals

Fujitsu’s receipt of lucrative government contracts despite its role in the Post Office Horizon scandal has come under greater scrutiny after the Treasury committee wrote to organisations including the Bank of England and HM Revenue and Customs to demand details of their contracts with the tech company.

The influential group of MPs told 21 public bodies, including the Treasury itself, to provide information on work given to the Japanese-owned company since 2019, when the high court ruled there had been dozens of bugs and errors in its Horizon IT system.

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Tax relief system needs overhaul to prevent abuse, say MPs

Treasury committee report says tax system is too complicated and finds two-thirds of relief policies are uncosted

Almost £200bn of tax reliefs handed to businesses and individuals each year should come under greater government scrutiny to prevent fraud and abuse, according to an all-party group of MPs.

The Treasury committee said in a report published on Wednesday that “a systematic review” into more than 1,000 tax reliefs was needed after MPs found HM Revenue and Customs did not have the resources to monitor how tax breaks and deductions were used.

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Benefits claimants in UK were underpaid by record £3.3bn last year

National Audit Office criticises Department for Work and Pensions over its ‘material fraud and error’

Thousands of people in the UK could receive a payout after official figures revealed that benefit claimants were underpaid by £3.3bn last year, the highest level on record.

The Department for Work and Pensions also admitted that as many as 330,000 people, some of whom have since died, may have missed out on as much as £1.5bn of valuable state pension entitlement – a disclosure that prompted some commentators to warn of a new scandal. Steve Webb, the former pensions minister, said: “The scale of these errors is huge.”

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UK’s best known retailers top list of firms fined £7m over pay breaches

WH Smith, Marks & Spencer and Argos among more than 200 firms that failed to pay workers legal minimum wage

Some of the UK’s best known retailers including WH Smith, Marks & Spencer, Argos and LloydsPharmacy are at the head of a list of more than 200 companies collectively fined £7m for failing to pay the legal minimum wage.

The businesses were also forced to pay out £4.9m to about 63,000 workers left out of pocket after violations of the rules were uncovered by inspectors at HMRC, varying from breaches related to asking workers to pay for aspects of their uniform to paying the incorrect apprenticeship rate.

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Nadhim Zahawi sacked as Tory party chair over tax affairs

Rishi Sunak fires Zahawi after he was found to have committed ‘serious breach’ of ministerial code

Rishi Sunak has sacked the Conservative party chair, Nadhim Zahawi, after he was found to have breached the ministerial code by failing to declare the HMRC investigation into his tax affairs.

An investigation by the prime minister’s ethics adviser, Sir Laurie Magnus, concluded that Zahawi had made a “serious breach” of the code by not telling officials he was under investigation by the tax body when he was appointed chancellor by Boris Johnson.

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Zahawi should quit as party chair until tax inquiry ends, top Tory peer implies

Lord Young suggests ministers should feel able to step aside for the duration of any investigation

Nadhim Zahawi should step away from his Conservative party role while the inquiry into his tax affairs continues, a senior Tory peer and former Commons standards chair has appeared to suggest.

Lord Young, who served in several Conservative administrations from Margaret Thatcher’s to Theresa May’s, suggested that ministers under pressure should feel able to step aside for the duration of any investigation.

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Minister unable to say whether Zahawi was telling truth when he first said taxes were fully paid – as it happened

Labour MP asks whether Zahawi statement in the summer was untrue, with Cabinet Office minister saying he does not know the answer

Nadhim Zahawi, the Conservative party chair, has welcomed the decision by Rishi Sunak to ask the No 10 ethics adviser to investigate his case. “I am confident I acted properly throughout,” Zahawi said.

Zahawi seems to be using a narrow definition of “properly”. In the statement he issued yesterday, he accepted that his original decision not to pay the tax that HM Revenue and Customs subsequently concluded he should have paid was down to a careless error. He said:

Following discussions with HMRC, they agreed that my father was entitled to founder shares in YouGov, though they disagreed about the exact allocation. They concluded that this was a ‘careless and not deliberate’ error.

Integrity and accountability is really important to me and clearly in this case there are questions that need answering …

That’s why the independent adviser has been asked to fully investigate this matter and provide advice to me on Nadhim Zahawi’s compliance with the ministerial code, and on the basis of that we’ll decide on the appropriate next steps.

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Nadhim Zahawi’s future threatened as Labour steps up pressure over tax affairs

Angela Rayner says Rishi Sunak should come clean about any concerns raised with No 10 about ex-chancellor and HMRC penalty

Nadhim Zahawi’s political future appeared under increasing threat on Sunday night, after Labour pushed hard for answers about his tax issues and government colleagues offered little support for his plight.

After a weekend dominated by questions over the Conservative party chair’s tax position, Labour signalled its intention to pin the controversy on to Rishi Sunak, demanding the prime minister explain if he knew about the issue when he appointed Zahawi to his cabinet.

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Tax collectors lack ambition, say MPs, as £42bn remains unpaid

Fraud and error have left ‘eye-watering’ amount owed to HMRC, says public accounts committee

The government has been criticised for failing to collect £42bn in unpaid tax from businesses and individuals amid concern over the strain on the public finances as the UK’s economy stands on the brink of recession.

The cross-party Commons public accounts committee (PAC) said that an “eye-watering” amount of tax was owed to HMRC, while also criticising tax collectors for lacking ambition to tackle fraud and error.

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