Goldman Sachs have £20m of our money, but we're on the road to getting it back

HMRC's sweetheart tax deal with Goldman Sachs must be declared unlawful

Last Wednesday we were delighted when a High Court judge declared that we will be allowed to take forward our case against HMRC over its decision to let banking giant Goldman Sachs off of up to £20m in interest on an unpaid tax bill. The banking giant has owed this sum since December 2010 and we want HMRC to correct their error and make Goldman Sachs pay their debt as soon as possible so that it can be invested in our vital public services at this time of unprecedented spending cuts.

Our aim now is to have the High Court declare that the agreement reached by HMRC with Goldman Sachs was unlawful. We also want the court to order HMRC to take steps to reopen the agreement it reached with Goldman Sachs about the interest owed and seek to recover that money.

Importantly, the day after we secured our review of HMRC's "sweetheart" deal with Goldman Sachs, the National Audit Office (NAO) published a report on how HMRC settled five large tax disputes with big business, each of these being examined by retired tax judge Sir Andrew Park. We believe that, while the report acknowledges some failures of decision-making and governance in the department, it raises far more questions than it answers.

For example, the five companies in question remain unnamed, so that the truth about these huge tax deals continues to be veiled behind HMRC’s claims of taxpayer secrecy for the powerful businesses in question.

Park also judges the merits of each of the five tax deals on grounds of "reasonableness", finding that each settlement was "reasonable". Crucially, however, Park does not – and cannot – make a judgment on whether the settlements were legal.

The report does appear to cover the Goldman Sachs dispute (understood to be "Company E") and gives some indication of why HMRC chose not to collect the unpaid tax owed to it.

Previously, HMRC's outgoing tax chief, Dave Hartnett – who is understood to have shaken hands with Goldman Sachs on the deal – admitted that he "made a mistake" for which he was "entirely responsible." However, Park finds that HMRC’s decision not to charge interest on Company E’s unpaid tax bill wasn't a mistake but a "deliberate decision" and "made sense in the context of reaching a settlement on all the issues under consideration" with the company. The problem with package deals like this is that they mainly benefit the interests of corporations, which want to minimise their tax bills, and enfeeble HMRC's ability to enforce its own rules and raise the necessary revenue.

Park outlines how the department's own "High Risk Corporates Programme Board" rejected the decision waiving Goldman Sachs interest on their tax bill, but that HMRC commissioners (which included Hartnett) decided to approve the settlement anyway. No explanation was given as to why the commissioners took this course of action at the time and no reasons were recorded until three months later. Even now those reasons remain secret.

Yet somehow Park still concludes that HMRC’s settlement with "Company E" was "reasonable". This is despite Park himself affirming that there was "no legal barrier to charging interest" on the company’s outstanding tax bill and the fact that HMRC's own rules prohibit it from making package deals with businesses.

Given the clear gaps and omissions in the NAO report, it remains vital that our case against HMRC goes ahead, to judge whether the deal with Goldman Sachs was legal, and to expose the truth behind this and other deals as far as possible. It is also important that the Public Accounts Committee follows up its December 2011 report concerning tax disputes in order to challenge and ultimately end the "cosy" relationship between HMRC and big business that it identified.

The public interest in these matters is clear – people have a right to know why a multi-billion pound investment bank and other corporations appear to have been let off the tax they owe while vital public services are being cut. The government now has a choice to make. It can clamp down on the billions of pounds worth of tax avoided by big business or continue making ordinary people pay for the economic crisis with their jobs and pensions.

The entrance to Goldman Sach's office in London. Photograph: Getty Images

Tim Street is the director of UK Uncut Legal Action

Felipe Araujo
Show Hide image

Manchester's Muslim community under siege: "We are part of the fabric of this nation"

As the investigation into last week's bombing continues, familiar media narratives about Islam conflict with the city's support for its Muslim population.

“You guys only come when something like this happens,” said one of the worshippers at Manchester's Victoria Park Mosque, visibly annoyed at the unusual commotion. Four days after the attack that killed 22 people, this congregation, along with many others around the city, is under a microscope.

During Friday prayers, some of the world’s media came looking for answers. On the eve of Ramadan, the dark shadow of terrorism looms large over most mosques in Manchester and beyond.

“People who do this kind of thing are no Muslims,” one man tells me.

It’s a routine that has become all too familiar to mosque goers in the immediate aftermath of a major terror attack. In spite of reassurances from authorities and the government, Muslims in this city of 600,000 feel under siege. 

“The media likes to portray us as an add-on, an addition to society,” Imam Irfan Christi tells me. “I would like to remind people that in World War I and World War II Muslims fought for this nation. We are part of the fabric of this great nation that we are.”

On Wednesday, soon after it was revealed the perpetrator of last Monday’s attack, Salman Ramadan Abedi, worshipped at the Manchester Islamic Centre in the affluent area of Didsbury, the centre was under police guard, with very few people allowed in. Outside, with the media was impatiently waiting, a young man was giving interviews to whoever was interested.

“Tell me, what is the difference between a British plane dropping bombs on a school in Syria and a young man going into a concert and blowing himself up,” he asked rhetorically. “Do you support terrorists, then?” one female reporter retorted. 

When mosque officials finally came out, they read from a written statement. No questions were allowed. 

“Some media reports have reported that the bomber worked at the Manchester Islamic Centre. This is not true,” said the director of the centre’s trustees, Mohammad el-Khayat. “We express concern that a very small section of the media are manufacturing stories.”

Annoyed by the lack of information and under pressure from pushy editors, eager for a sexy headline, the desperation on the reporters’ faces was visible. They wanted something, from anyone, who had  even if a flimsy connection to the local Muslim community or the mosque. 

Two of them turned to me. With curly hair and black skin, in their heads I was the perfect fit for what a Muslim was supposed to look like.

"Excuse me, mate, are you from the mosque, can I ask you a couple of questions,” they asked. “What about?,” I said. "Well, you are a Muslim, right?" I laughed. The reporter walked away.

At the Victoria Park Mosque on Friday, Imam Christi dedicated a large portion of his sermon condemning last Monday’s tragedy. But he was also forced to once again defend his religion and its followers, saying Islam is about peace and that nowhere in the Koran it says Muslims should pursue jihad.

“The Koran has come to cure people. It has come to guide people. It has come to give harmony in society,” he said. “And yet that same Koran is being described as blood thirsty? Yet that same Koran is being abused to justify terror and violence. Who de we take our Islam from?”

In spite of opening its doors to the world’s media, mosques in Britain’s major cities know they can do very little to change a narrative they believe discriminates against Muslims. They seem to feel that the very presence of reporters in these places every time a terror attack happens reveals an agenda.

Despite this, on the streets of Manchester it has proved difficult to find anyone who had a bad thing to say about Islam and the city’s Muslim community. Messages of unity were visible all over town. One taxi driver, a white working-class British man, warned me to not believe anything I read in the media.

“Half of my friends are British Muslims,” he said even before asked. “ These people that say Islam is about terrorism have no idea what they are talking about.”

Felipe Araujo is a freelance journalist based in London. He writes about race, culture and sports. He covered the Rio Olympics and Paralympics on the ground for the New Statesman. He tweets @felipethejourno.

0800 7318496