HMRC probed in Commons

Kasmira Jefford
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A TAX OFFICIAL lost their bonus following a blunder that allowed Goldman Sachs to escape a tax bill of around £10m, Parliament was told yesterday.

In a hearing by MPs on the Public Accounts Committee yesterday, Dave Hartnett, permanent secretary for tax at HMRC said the error was dealt with through a staff member’s annual appraisal.

HM Revenue & Customs has come under fire for arranging a so-called “sweetheart” deal with Goldman Sachs that waived £10m interest on a £30m bill from a failed tax avoidance scheme on bankers’ bonuses.

When asked whether that meant the tax official had lost his bonus, Mr Hartnett said: “I think that’s another way of putting it.”

The session was part of an inquiry into tax deals negotiated by HMRC with Vodafone and Goldman Sachs, which were brought to light after findings by the Guardian and Private Eye.

HMRC’s most senior solicitor, Anthony Inglese and top civil servant Sir Gus O’Donnell, were also asked to give their accounts.

HMRC has been accused of letting Vodafone pay only £1.25bn to settle a tax dispute when the amount owed to taxpayers should have been around £6bn, leading to protests outside Vodafone’s annual meeting in July.

Hartnett has previously described the sum as an “urban myth” but MPs yesterday said the amount of tax lost could be as high as £8bn.

Margaret Hodge, the Committee chair, questioned why HMRC appeared to have a special relationship with big businesses, doing deals in a way that would not be possible for smaller enterprises or individual taxpayers.