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GOLDMAN SACHS TIMELINE

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The Goldman Sachs Group, Inc. (NYSE: GS) 
is an American multinationalinvestment banking firm that engages in global investment banking, securities, investment management, and other financial services primarily with institutional clients.
Goldman Sachs was founded in 1869 and is headquartered at 200 West Street in theLower Manhattan area of New York City, with additional offices in international financial centers. The firm provides mergers and acquisitions advice, underwriting services, asset management, and prime brokerage to its clients, which include corporations, governments and individuals. The firm also engages in market making and private equity deals, and is aprimary dealer in the United States Treasury security market. It is recognized as one of the premier investment banks in the world, but has sparked a great deal of controversy over its alleged improper practices, especially since the 2007–2012 global financial crisis.
Former Goldman executives who moved on to government positions include: Robert Rubinand Henry Paulson who served as United States Secretary of the Treasury under Presidents Bill Clinton and George W. Bush, respectively; Mark Carney, the governor of the Bank of Canada since 2008; Mario Draghi, governor of the European Central Bank.

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02/05/2013

For immediate release
HMRC LET GOLDMAN SACHS OFF TAX TO AVOID ‘MAJOR EMBARRASSMENT’ FOR GEORGE OSBORNE 
In the legal case against HMRC over the ‘sweetheart’ tax deal with Goldman Sachs, details have emerged of a controversial cover up to avoid political embarrassment at the heart of government.
It came to light in the High Court that the former tax chief, Dave Hartnett, chose to waive the £20 million that Goldman Sachs owed to HMRC to save his personal reputation, and avoid major political embarrassment for George Osborne and HMRC. The political scandal has been revealed by UK Uncut Legal Action, the anti-cuts campaigners who have brought the case against HMRC.
Dave Hartnett personally overruled legal advice, the HMRC’s own guidelines and HMRC’s internal review Board which all stated that HMRC was in a position to force Goldman Sachs to pay back the money owed. Shortly after the oral deal had been made between Dave Hartnett and Goldman Sachs to waive the £20 million that Goldman Sachs owed, the HMRC’s High Risk Corporate Programme Board, an internal oversight board, rejected the deal and recommended that negotiations be re-opened to recoup the money owed.
In an email, that has come to light in court, written by Dave Hartnett to other senior tax officials, Hartnett states that when Goldman Sachs were informed of the Board’s decision to reject the deal and force the bank to pay the interest, the bank “went off the deep end”. He also warns of potential major political embarrassment stating: “the risks here are major embarrassment to the Chancellor of the Exchequer, HMRC, the Large Business Service of the HMRC, you and me, not least if GS withdraw from the Code.”
In Dave Hartnett’s written witness statement, he states that “Goldman Sachs had been involved in tax avoidance in the past and we regarded their signing of the Code as a valuable step in securing improved tax behaviour from them. This would have been under threat had we reneged on the settlement (they said they would withdraw from the Code if HMRC reopened the settlement).”
Dave Hartnett says that this would be a source of major embarrassment for George Osborne because only one week before, the Chancellor had publicly announced that the government was cracking down on tax avoidance by big banks and had successfully forced the top 15 banks, including Goldman Sachs, to sign up to the Code of Practice on taxation designed to reduce tax avoidance.
Murray Worthy, Director of UK Uncut Legal Action said:
“This case exposes a controversial cover up at the heart of government by HMRC and former tax chief, Dave Hartnett to avoid political embarrassment for George Osborne.
“George Osborne announced the Bankers Code for tax avoidance with great fanfare, claiming that he was forcing banks to pay their fair share. Yet on the same day, Goldman Sachs were threatening to withdraw from the Code if HMRC forced them to pay the tax they owed. HMRC waived millions of pounds owed by Goldman Sachs against legal advice and HMRC’s own guidelines to salvage Dave Hartnett’s personal reputation and George Osborne’s veneer of tough tax talk.”
Anna Walker, Campaigns Director at UK Uncut Legal Action said:
“This case shows the lengths that the government will go to in order to preserve the public perception that government is getting tough on tax avoidance. HMRC have tried tirelessly to cover up this deal. They have stonewalled the Public Accounts Committee, whitewashed the NAO report, criminalised a whistle blower and have fought this legal case every step of the way.
“In the run up to the G8, where David Cameron and George Osborne will pronounce themselves as global leaders in tackling tax avoidance, this case shows what is going on behind closed doors and the headline grabbing announcements – tax avoidance as usual, sweetheart deals to avoid red faces of ministers and giving in to threats from big business.”
“Every year, £25 billion of tax is avoided in the UK. This is because the government refuses to stand up to big business and banks like Goldman Sachs and chooses to let them off paying their fair share. The government is making a political choice to cut legal aid, privatise the NHS and slash the welfare state instead of making big business and banks pay for the crisis they caused.”
UK Uncut Legal Action is seeking a ruling that the deal reached between Goldman Sachs and HMRC was unlawful because it was in direct contradiction of HMRC’s own statutory duty to collect tax properly, and its own guidance.
ENDS
Spokespeople available Rosa Curling from Leigh Day and members of UK Uncut Legal Action will be at the Court and available for photographs and interview.
Documents from court and key legal arguments are available on request or at ukuncutlegalaction.org.ukFor more information/interviews, please call UK Uncut Legal Action on 07415 063 231 and 07591 992 825 and 07425 261 383 email: ukuncutlegal@gmail.comor David Standard at Leigh Day on 07540 332717
The facts of Goldman Sachs’ tax avoidance scheme and the deal.
In the 1990s, Goldman Sachs set up a company in the British Virgin Islands called Goldman Sachs Services Ltd. This company appears to have been set up to achieve payments to bankers of disguised bonuses, thereby reducing or avoiding national insurance contributions payable on them.
By 2005, HMRC had demonstrated that this scheme was an illegitimate tax avoidance device. In July 2011, HMRC’s own QC, Malcolm Gammie, gave broadly positive advice that HMRC should therefore be able to recover all monies owed to it by the company.
Despite this strong advice from HMRC’s own lawyers, Dave Hartnett, the boss at HMRC, met Goldman’s tax director, Mike Housden, and shook hands on a deal which allegedly let the bank off £20 million tax owed in 2010 and refused to go back on the deal after further legal advice and a rejection of the deal by HMRC’s internal Board.
Importantly, the day after we secured our review of HMRC’s ‘sweetheart’ deal with Goldman Sachs last June, 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.
Leigh Day has advised UK Uncut Legal Action that the agreement reached was in direct contradiction of HMRC’s own statutory duty to collect tax properly due, and its litigation settlement strategy prohibiting package deal settlements or settlements where HMRC splits the difference with the taxpayer. It is therefore unlawful.

  • George Osborne announces in October that Banks have one month to sign up to the Code | HERE
  • George Osborne announces banks have signed up to Code | HERE
  • For further information about the Head of the NAO’s comments regarding the judge led investigation | HERE
The Lawyer magazine states that the case is one of the top cases of 2013.
HMRC in the High Court over Goldman Sachs ‘Sweetheart’ tax deal
The High Court will next week hear evidence in the full hearing of the legal case against HMRC over the Goldman Sachs ‘sweetheart’ tax deal.
The case is being brought by UK Uncut Legal Action, a campaign organisation inspired by the anti-cuts direct action group UK Uncut. The case centres around a deal which was personally negotiated by Dave Hartnett (former head of HMRC) and Goldman Sachs resulting in the global investment bank being let off paying up to £20 million in interest charges on an unpaid tax bill.
UK Uncut Legal Action claims the deal was unlawful as it breached HMRC’s own rules and guidelines.
The case was granted permission to go to a full hearing in June 2012 – just one day before the NAO concluded its judge led investigation into tax settlements which found that the Goldman Sachs deal was ‘reasonable’. However, the Guardian recently revealed that the Head of the NAO, Amayas Morse, who set up the ‘independent’ review, appeared to undermine the process before it had even started by telling Dave Hartnett that the inquiry would find ‘nothing of substance’.
Anna Walker, spokesperson for UK Uncut Legal Action said:
“We are taking this case forward to get this deal declared unlawful in the High Court so that HMRC is no longer under the misapprehension that it is either legally, nor politically acceptable to let big business off paying the tax that they owe.“Every year £25 billion is lost to the public purse through tax avoidance schemes such as the one Goldman Sachs used. The government cannot seriously claim to be clamping down on tax avoidance whilst it continues to let companies off millions in tax owed.“The government’s claims are hollower still when the only people they are though on are the poorest people as they privatise the NHS, cut legal aid and force people on benefits to pay extra for a bedroom that their disabled child sleeps in.”
Rosa Curling, a lawyer from law firm Leigh Day, who is representing UK Uncut Legal Action, said:
“We have advised our clients that the deal reached between HMRC and Goldman Sachs was unlawful – it was in direct contradiction to HMRC’s duty to collect taxes and to do so properly, fairly and equally. Goldman Sachs is one of the richest banks in the world. The coalition government has stated on several occasions that it is committed to ensuring companies cannot avoid paying the taxes they owe.
“Despite this, the government has chosen to oppose our client’s claim. UK Uncut Legal Action has therefore had no option but to ask the Court to intervene so it can ensure a clear message is sent to all – that the tax rules apply to all corporations in the same way, however rich and powerful they may be.”
ENDS
—–
Spokespeople available:
Rosa Curling and members of UK Uncut Legal Action will be at the Court and available for photographs and interview.
The facts of Goldman Sachs’ tax avoidance scheme and the deal.
In the 1990s, Goldman Sachs set up a company in the British Virgin Islands called Goldman Sachs Services Ltd. This company appears to have been set up to achieve payments to bankers of disguised bonuses, thereby reducing or avoiding national insurance contributions payable on them.
By 2005, HMRC had demonstrated that this scheme was an illegitimate tax avoidance device. In July 2011, HMRC’s own QC, Malcolm Gammie, gave broadly positive advice that HMRC should therefore be able to recover all monies owed to it by the company.
Despite this strong advice from HMRC’s own lawyers, Dave Hartnett, the boss at HMRC, met Goldman’s tax director, Mike Housden, and shook hands on a deal which allegedly let the bank off £20 million tax owed in 2010 and refused to go back on the deal after further legal advice and a rejection of the deal by HMRC’s internal Board.
Importantly, the day after we secured our review of HMRC’s ‘sweetheart’ deal with Goldman Sachs last June, 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.
Leigh Day has advised UK Uncut Legal Action that the agreement reached was in direct contradiction of HMRC’s own statutory duty to collect tax properly due, and its litigation settlement strategy prohibiting package deal settlements or settlements where HMRC splits the difference with the taxpayer. It is therefore unlawful.
For further information about the Head of the NAO’s comments regarding the judge led investigation: HERE
UK Uncut Legal Action Update- We’re in court on May 2nd!
On Thursday May 2nd UK Uncut Legal Action will be going head-to-head in the High Court with HMRC over their sweetheart deal with Goldman Sachs. Our lawyers from Leigh Day & Co will be arguing that HMRC must face a day of reckoning for breaking their own rules when letting banking giant Goldman Sachs off at least £10 million in interest on a tax dispute. Our aim is for the High Court to declare that the agreement reached by HMRC with Goldman Sachs was unlawful. If we win our case it will send a clear message to HMRC – rich and powerful corporations must not make and break the rules. At a time when the government is making huge, unjust cuts to public spending, the rich must pay their fair share.
Throughout the history of this dodgy deal, which was first brought to light by Private Eye in April 2011, the powers that be have gone out of their way to try and protect those responsible from being brought to justice. Immediately after our first hearing last June, the National Audit Office (NAO) published a report on large ‘sweetheart’ tax settlements which found that the Goldman Sachs deal was ‘reasonable’ and in the public interest. However, the Guardian recently revealed how Britain’s most senior auditor, who set up the NAO review, appeared to undermine the process before it began by telling Dave Hartnett – the UK’s most senior tax official – that the inquiry would find ‘nothing of substance’.
The scandal
The story of the dodgy deal begins in the 1990s, when Goldman Sachs set up a company offshore in the British Virgin Islands called Goldman Sachs Services Ltd. This set-up appears to have been designed to conceal the size of bankers’ bonuses. When questioned by HMRC it turned out that Goldman was not only concealing the amount of their banker’s bonuses but was also refusing to pay its share of national insurance on these six-figure bonuses.
How did they dodge the tax?
Goldman Sachs, along with 21 other investment banks and other firms, purchased blueprints for an avoidance scheme called an employee benefit trust (EBT). It took HMRC until 2005 for the courts to rule that these EBTs were illegitimate tax avoidance schemes. Whilst the other firms surrendered and handed over what they owed to HMRC, Goldman Sachs refused to pay its £30.81m bill.
By 2010, it is estimated that the unpaid bill with accumulated interest had mounted to at least £40m. In April 2010 HMRC and Goldman went to court, a judge threw out the claim from the bankers that their true employer was in the British Virgin Islands. In July 2011, HMRC’s own QC, Malcolm Gammie, gave ‘broadly positive’ advice that the government was in a strong position to get all of its money.
The sweetheart deal
However, instead of HMRC clawing the money back, then came ‘the deal’. Allegedly, on 30 November 2011, a high-level HMRC committee heard that their top expert, Dave Hartnett, had met Goldman’s tax director, Mike Housden, and as a result ‘a late submission had come in about a deal on which Hartnett had ‘shaken hands’ with Goldman Sachs’. The government was not going to get its full £40m, but only £30m. It is important to recognise that much of what is known about this case only became public because of the integrity of a HMRC whistleblower- Osita Mba.
UK Uncut Legal Action vs HMRC / Goldman Sachs
So that’s where we come in. Our case is important as we want to draw a line in the sand- HMRC must change its culture of being cosy with big business and instead represent the interests of the people. The public does not want a multi-billion pound investment bank and other corporations to be 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.
See you in court
On Thursday May 2nd UK Uncut Legal Action will be going head-to-head in the High Court with HMRC over their sweetheart deal with Goldman Sachs.
Our lawyers from Leigh Day & Co will be arguing that HMRC must face a day of reckoning for breaking their own rules when letting banking giant Goldman Sachs off at least £10 million in interest on a tax dispute.
Our aim is for the High Court to declare that the agreement reached by HMRC with Goldman Sachs was unlawful. If we win our case it will send a clear message to HMRC – rich and powerful corporations must not make and break the rules.
At a time when the government is making huge, unjust cuts to public spending, the rich must pay their fair share.
We need people to come to court on the day to show your support for the case. As it is court we need to know names and please dress smart. If you want to come please email ukuncutlegal@gmail.com.
Goldman Sachs have £20m of our money, but we’re on the road to getting it back
(This article first appeared on the New Statesman website on 20th June 2012)
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 itsDecember 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.
Press release: UK Uncut campaigners secure High Court challenge of Goldman Sachs tax deal
A High Court judge has declared that the anti-cuts campaign group UK Uncut Legal Action should be allowed to take forward their case against HMRC over its decision to let banking giant Goldman Sachs off of up to £20 million in tax- owed since December 2010.
This blow to HMRC comes ahead of tomorrow’s report from the National Audit Office who have been investigating five similar tax deals with as yet unnamed companies, but believed to include Goldman Sachs and Vodafone.
The case for a judicial review is being led by campaign group UK Uncut Legal Action – a spin-off organisation from the UK Uncut protest movement – and public law specialists Leigh Day & Co. It is expected that the court hearing will be in October and last five days. UK Uncut Legal Action’s case is being funded by thousands of small donations from individuals, largely raised through appeals on Twitter and Facebook.
This follows months of parliamentary scrutiny in 2011 over the way HMRC deals with the tax affairs of big business. In a report published in December 2011, the Public Accounts Committee concluded “We have serious concerns about how the Department handled some cases involving large settlements, where governance arrangements were bypassed or overlooked until it was too late.” The report also described the organisation as unaccountable and secretive, and declared that senior tax officials gave “imprecise, inconsistent and potentially misleading” evidence to parliament.
Today’s ruling gives permission to UK Uncut Legal Action to take forward a judicial review which will decide whether or not the alleged ‘sweetheart deal’ with Goldman Sachs was legal. The judge did not give permission for the group to take forwards a claim seeking to ‘quash’ or strike down the deal, and the group are consulting with their lawyers on whether or not to appeal this decision.
Murray Worthy of UK Uncut Legal Action said “We welcome the court’s decision that we can take forwards our case challenging the alleged ‘sweetheart deal’ between HMRC and Goldman Sachs. The judge agreed that this case is clearly in the public interest and that HMRC have real questions to answer about the legality of this deal.”“It is vital that these issues are addressed in court. The National Audit Office and Public Accounts Committee investigations are looking at policy issues, but this case is a question of legality and justice which only the courts can decide.”“The public have a right to know why a multi-billion pound investment bank appears to have been let off the tax they owe while vital public services are being cut. The government is making a political choice in making ordinary people pay for the economic crisis with their jobs and pensions, rather than clamping down on billions of pounds worth of tax avoidance by big business.”
Richart Stein of Leigh Day & Co said “I am really pleased that the courts have decided that a public hearing can go ahead looking into the deal between HMRC and Goldman Sachs. We look forward to seeing the NAO report and we will re-consider how we advance the case after we have seen it.”
ENDS
Photo available on request. 
(1) DETAILS OF THE TAX DISPUTE
In the 1990s, Goldman Sachs set up a company offshore in the British Virgin Islands called Goldman Sachs Services Ltd, which appears to have been designed to conceal the size of their bankers’ bonuses. Goldman Sachs also begrudged paying its share of UK national insurance on these six-figure bonuses.
The company, along with 21 other investment banks and other firms, purchased blueprints for an avoidance scheme called an employee benefit trust (EBT). It took the Revenue until 2005 for the courts to rule that these EBTs were merely illegitimate tax avoidance devices. Whilst the other firms surrendered and handed over what they owed, Goldman Sachs refused to pay its £30.81m bill.
By 2010, it is estimated that the unpaid bill with accumulated interest had mounted to £40m.
In April 2010 a judge threw out the claim from the bankers that their true employer was in the British Virgin Islands. In July 2010, HMRC’s own QC, Malcolm Gammie, gave “broadly positive” advice that the government was in a strong position to get all of its money.
However, on 30 November 2010, a high-level HMRC committee heard that their top expert, David Hartnett, had met Goldman’s tax director, Mike Housden, and as a result “a late submission had come in about a deal on which Dave Hartnett had ‘shaken hands’ with Goldman Sachs”. The government was not going to get its full £40m, but only £30m.
According to the Guardian (11 October 2011) HMRC sources privately confirm that £10m of taxpayers’ money was thrown away because of a “technical mistake” by an unidentified official, junior to Hartnett, who misinterpreted the law. They claim that the National Audit Office, which audits HMRC accounts, has accepted the situation.
(2) ‘Revenue to appear in court over Goldman Sachs ‘sweetheart’ deal’ | HERE
(3) On 14th June the NAO will publish a report entitled ‘Tax and duties: Larger tax settlements: a follow-up report’. The review will examine the reasonableness of five of the largest tax settlements with big business. HERE
(4) A December 2011 report from the Public Accounts Committee suggested HMRC risks losing “many millions of pounds” in cases where it is chasing a total of more than £25bn in unresolved tax bills because of a “too cosy” relationship with big business. HERE
PRESS RELEASE: Judge to rule on legal review of Goldman Sachs tax deal

  • UK Uncut Legal Action is in court on June 13th where a judge will decide whether a judicial review of HMRC’s tax deal with Goldman Sachs can go ahead. (1)
The campaign group is demanding that the decision to let Goldman Sachs of millions in unpaid tax is reversed and the money returned to the public purse.
Support for the case has been voiced by leading Trade Unions, NGOs and MPs.
Over £19,000 has been raised for the case in six months showing a huge level of public support.
The decision comes the day before a report from the National Audit Office who have been investigating similar tax deals with several as yet unnamed companies.

  • UK Uncut Legal Action, a campaign group inspired by the anti-cuts direct action group UK Uncut, will find out on June 13th whether they will have secured a judicial review of HMRC’s alleged ‘sweetheart’ tax deal with Goldman Sachs. (2)
  • This comes a day before the National Audit Office (NAO) publishes a report examining the ‘reasonableness’ of several large tax settlements with big business. (3)
  • UK Uncut Legal Action have welcomed scrutiny into tax deals from both the NAO and the Public Accounts Committee but claim the legal action they are taking is the only mechanism that can result in a declaration that the Goldman Sachs tax deal was unlawful, as well as returning the £20 million owed so that it can be invested in vital public services. (4)
Richard Stein from Leigh Day & Co said: 
“We wrote to HMRC in October 2010 asking them to quash the deal and reclaim the millions unpaid in taxes from one of the world’s richest banks but received no response. We chased again in November and they claimed they needed more time.“They have now replied with what we feel is an extremely weak argument as to why this decision cannot be reversed, therefore, we will now progress this legal action and issue proceedings in the High Court.”UK Uncut Legal Action has also launched a public fundraising appeal, which has raised nearly £19,000 in six months with over two thousand people making small donations. This represents what the campaign group is calling a ’people’s court case’ against HMRC.Support for this legal action has also been voiced by leading anti-poverty NGOs, MPs and Unions, such as the National Union of Teachers, Unite, PCS, GMB, Compass and the Tax Justice Network, who have signed onto a UK Uncut Legal Action statement which says: ”It is undeniably in the public interest that this important case should go through the UK courts in order to ensure transparency, accountability and fairness.”
Murray Worthy, director of UK Uncut Legal Action said:
“There is overwhelming public support from Unions, NGOs, MPs and thousands of ordinary people who want to see this dodgy tax deal challenged in the courts. It shows the deep level of outrage that people feel over state sanctioned tax dodging by big business, while the government destroys public services that ordinary people rely on, saying that there is no money.
He continued, “It shows that the government is making a political choice to turn a blind eye to tax dodging- which loses the public purse £25bn billion a year. The government is slashing public services and support for the poorest instead of clamping down on rich tax dodgers. This cannot be allowed to continue. Dave Hartnett’s retirement is welcome news for campaigners but HMRC needs a massive culture change to stop special treatment for corporations and secret, unlawful handshake deals”
Notes:
(1) DETAILS OF THE TAX DISPUTE
In the 1990s, Goldman Sachs set up a company offshore in the British Virgin Islands called Goldman Sachs Services Ltd, which appears to have been designed to conceal the size of their bankers’ bonuses. Goldman Sachs also begrudged paying its share of UK national insurance on these six-figure bonuses.
The company, along with 21 other investment banks and other firms, purchased blueprints for an avoidance scheme called an employee benefit trust (EBT). It took the Revenue until 2005 for the courts to rule that these EBTs were merely illegitimate tax avoidance devices. Whilst the other firms surrendered and handed over what they owed, Goldman Sachs refused to pay its £30.81m bill.
By 2010, it is estimated that the unpaid bill with accumulated interest had mounted to £40m.
In April 2010 a judge threw out the claim from the bankers that their true employer was in the British Virgin Islands. In July 2011, HMRC’s own QC, Malcolm Gammie, gave “broadly positive” advice that the government was in a strong position to get all of its money.
However, on 30 November 2011, a high-level HMRC committee heard that their top expert, David Hartnett, had met Goldman’s tax director, Mike Housden, and as a result “a late submission had come in about a deal on which Dave Hartnett had ‘shaken hands’ with Goldman Sachs”. The government was not going to get its full £40m, but only £30m.
According to the Guardian (11 October 2011) HMRC sources privately confirm that £10m of taxpayers’ money was thrown away because of a “technical mistake” by an unidentified official, junior to Hartnett, who misinterpreted the law. They claim that the National Audit Office, which audits HMRC accounts, has accepted the situation.
(2) ‘Revenue to appear in court over Goldman Sachs ‘sweetheart’ deal’ | HERE
(3) On 14th June the NAO will publish a report entitled ‘Tax and duties: Larger tax settlements: a follow-up report’. The review will examine the reasonableness of five of the largest tax settlements with big business. | HERE
(4) A December 2011 report from the Public Accounts Committee suggested HMRC risks losing “many millions of pounds” in cases where it is chasing a total of more than £25bn in unresolved tax bills because of a “too cosy” relationship with big business. | HERE

Can you come to court with us on Wednesday 13th June?
Dear Everyone,
On Wednesday 13th June a judge will consider whether our Judicial Review should go through to a full hearing later this year. We have spaces in the public gallery to fill and we would like you to join us.
Please email us at ukuncutlegal[@]gmail.com if you a) ‘do smart’ b) are free for a couple of hours next Wednesday at the Royal Courts of Justice.
The more the merrier! It’s crucial to convey how important this court case is! Why did Goldman Sachs get let off £20m in tax? It’s crucial that a judge considers the legality of the decision. First we must convince judge number 1 on Wednesday 13th that this is in the public interest!
Get in touch and come to the peoples court case!
UK Uncut Legal Action

PRESS RELEASE: UK Uncut Legal Action issue legal proceedings against HMRC
UK Uncut Legal Action will issue legal proceedings against HMRC with a Photo Op at 15:30pm today. 

  • Campaign group goes for a full quashing of the tax agreement 
  • Support for the case voiced by leading Trade Unions, NGOs and MPs
  • £14,000 has been raised for the case in two weeks showing huge level of public support.
  • Adding to the parliamentary pressure on HMRC this week from the Public Accounts Committee, UK Uncut Legal Action, an NGO inspired by the anti-cuts direct action group UK Uncut will issue proceedings in the High Court today against HMRC, over the Goldman Sachs tax deal.
The campaigning group made the decision to go forward with the case after receiving what they term a ‘dismissive’ response from HMRC to letters from their lawyers demanding the alleged sweetheart deal agreed between David Hartnett and Goldman Sachs is quashed.
UK Uncut Legal Action have welcomed scrutiny into tax deals from both the National Audit Office and the Public Accounts Committee reports but claim the legal action they are taking is the only mechanism that can result in a declaration that the Goldman Sachs tax deal was unlawful, as well as returning £20 million to the public purse.
Leigh Day & Co who are acting for UK Uncut Legal Action, confirmed in a letter sent in October that if the settlement reached between HMRC and Goldman Sachs, allegedly allowing the company off £20million worth of tax owed, was not reversed it would issue these proceedings which seek specific disclosure for all internal documents regarding the process by which agreement was reached.
Richard Stein from Leigh Day & Co said: “We wrote to the HMRC in October asking them to quash the deal and reclaim the millions unpaid in taxes from one of the world’s richest banks but received no response. We chased again in November and they claimed they needed more time.“They have now replied with what we feel is an extremely weak argument as to why this decision cannot be reversed, therefore, we will now progress this legal action and issue proceedings in the High Court.”UK Uncut Legal Action has also launched a public fundraising appeal, which has raised nearly £14,000 in two weeks with over two thousand people making small donations. This represents what the campaign group is calling a ’people’s court case’ against HMRC.Support for this legal action has also been voiced by leading anti-poverty NGOs, MPs and Unions, such as the National Union of Teachers, Unite, PCS, GMB, Compass, and the Tax Justice Network, who have signed onto a UK Uncut Legal Action statement which says: ”It is undeniably in the public interest that this important case should go through the UK courts in order to ensure transparency, accountability and fairness.”
Tim Street, director of UK Uncut Legal Action said:
“There is overwhelming public support from Unions, NGOs, MPs and thousands of ordinary people who want to see this dodgy tax deal challenged in the courts. It shows the deep level of outrage that people feel over state sanctioned tax dodging by big business, while government destroys public services that ordinary people rely on, saying that there is no money.He continued, “It shows that the government is making a political choice to turn a blind eye to tax dodging- which loses the public purse £25bn billion a year. The government is slashing public services and the support for the poorest instead of clamping down on rich tax dodgers. This cannot be allowed to continue. Dave Hartnett’s retirement is welcome news for campaigners but HMRC needs a massive culture change to stop special treatment for corporations and secret unlawful handshake deals”
Photo Op: 1530pm, HMRC, Horse Guards Parade
Lawyers and campaigners will hand the legal documents to HMRC.
ENDS

Breaking news: Parliament releases damning report into dodgy corporate tax deals
We can be one of the first to reveal the details of the Public Accounts Committee’s damning corporate tax report that is being released today. It describes systematic failures and fundamental concerns at the way HMRC operates regarding its handling of billions of pounds worth of tax disputes with big business.
This report is an important reflection of 14 months of UK Uncut campaigning by people up and down this country, well done everyone!
Here’s a summary of the key points from the PAC report:

  1. HMRC is currently in negotiation over £25bn worth of tax disputes from 2,700 companies
  2. There is an unfair disparity between the way some large corporations and ordinary tax payers are treated by the tax office. Companies have millions wiped off their tax bills, or they are given a whopping 10 years to pay their liabilities.  Small business owners or individuals do not receive this favorable treatment
  3. HMRC is unaccountable and secretive. Even parliament, let alone the general public, do not have any oversight. The PAC finds it farcical that HMRC keeps details about high value corporate tax deals that involve billions of pounds secret. They argue that there is less justification for keeping tax information about big companies confidential than for information about individuals
  4. That when called into Parliament to answer important questions about controversial tax details that have lost the public billions of pounds, Dave Hartnett – the chief tax man – gave “imprecise, inconsistent, and potentially misleading” information. Senior officials are seriously failing to be open and accountable
  5. That HMRC routinely ignores its own governance procedures and that we have a ludicrous situation where those negotiating tax deals can also ‘sign off’ on these deals, sometimes even without third party legal oversight. This means that some of these tax deals could not only be outrageous, but also unlawful
  6. There is a complete failure by tax officials to take any responsibility for HMRC’s failings

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