David Drew MP calls on PM to halt Loan Charge
A number of residents have contacted me regarding the Loan Charge legislation and I share their considerable concerns about this cruel and unfair retrospective taxation.
I am pleased to support the Loan Charge Action Group and have written to the Prime Minister and the Chancellor asking them to urgently review the Loan Charge legislation before more families are pushed into hardship and potentially more lives are lost.
You can read my letter in full below:
Re: Loan Charge
I am writing to you on behalf of the many constituents of mine who will be affected by the Loan Charge and in support of the Loan Charge Action Group (LCAG)’s campaign to push for a delay of this legislation to enable a full and independent review. It is vital that this review is commissioned immediately; the deadline set by HMRC for agreeing settlement is 31 August 2019 and without it there is a very real risk of more people encountering hardship to such a degree that some have been driven to suicide.
I shouldn’t need to point out that the Loan Charge is an unfair charge, in that all retrospective tax often leaves people in very difficult circumstances. In this case, it is particularly challenging as the charge lands on the shoulders of individuals and not companies, resulting in potentially extremely challenging financial situations. Your government must act to make sure that people are not unfairly penalised for taking part in a programme that was legal and available to many.
As some of the cases which have come to my attention underline, the personal and financial consequences are too terrible for some of individuals affected to even contemplate. Previously, any PAYE charges that arose as a result of these measures would fall fairly on the employer. Other than in limited circumstances, it was unlikely that such a liability could be transferred to the individual; however, under the new Loan Charge, this is exactly the case.
It is of great concern to me that this Loan Charge is being retrospectively applied to loans dating back almost 20 years, affecting contractors, freelancers, social workers, teachers, nurses and more. It is important that people who took part in this programme in good faith are not left unsupported and suffering from aggressive debt collection. I must say that I echo the considerable concerns put forward by the APPG on this matter, and I wholeheartedly condemn the aggressive imagery and slogans used by HMRC to pursue people, including very vulnerable persons.
It is clear to me that there continues to be a severe lack of Parliamentary scrutiny over tax legislation and that this is something that needs to be addressed. I am aware of your statement that it seems ‘superficially unjust’ that persons could be retrospectively pursued for what they were told was an ‘entirely legal option’ and I am encouraged by your assertion that the Loan Charge ‘needs a proper independent review’. In light of these words, I am now calling on you to back these words up with actions to ensure that individuals are not penalised and left financially distressed by this extreme and somewhat draconian change. I look forward to receiving your thoughts on this matter.
David Drew MP