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Court rules on Goldman's favourable tax treatment

Sunday, 24 June 2012   (0 Comments)
Posted by: SAIT Technical
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By Alastair Morphet (MoneyWebTax)

There has been much controversy in South Africa about the Government's Gauteng Urban Tolling System, and the subsequent decision of Prinsloo J to refer it for judicial review. The Treasury will now appeal the decision to the Constitutional Court.

An interesting matter arose in England recently when the National Auditor found that Her Majesty's Revenue and Customs settling a matter with Goldman Sachs was within the bounds of acceptable administration. In the High Court, Justice Peregrine Simon referred the same decision to a judicial review that he felt was plainly in the public interest.

An NGO, UK Uncut Legal Action, had applied to court on the basis that the Revenue officials had given the multinational bank favourable treatment in the settlement of a tax dispute. Ingrid Simler QC arguing the matter for the NGO, argued that the deal should be quashed by the Courts.

James Eadie QC, arguing for the Revenue, had said that the National Auditor's investigation would settle the matter and it was the appropriate authority to consider whether the transaction between the head of Her Majesty's Revenue and Customs, Dave Hartnett and senior Goldman Sachs representatives should have been allowed.

Justice Simon ruled that despite the National Audit office report, it would not tackle the legality of the transaction. He said that there was public interest in the matter and that maladministration and legality were separate issues.

As it was reported in the Guardian, the Judge said that he did not think the Court would "quash" the agreement between Her Majesty's Revenue and Goldman Sachs - he left the door open for Uncut's lawyers to argue that the agreement be declared illegal.

Her Majesty's Revenue said that they would strongly contest this application. They believe that large business tax settlements are a vital part of how they run their business and that without them British Public Finance would be seriously damaged.



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