Government by Nudge

16 Aug 2015

According to The Times, the government's new business start-up tsar, Michelle Mone, has been accused of using a tax avoidance vehicle that has been described by George Osborne as "morally repugnant". Her company MJM International Limited paid £500,100 into an employee benefit trust (EBT) between 2009 and 2011. HMRC considers EBTs to be tax avoidance schemes and has pursued settlements with companies that used them.

Since tax avoidance is the legal minimising of Tax liability, it might be suggested that HMRC pursues those that break tax law and that the Chancellor steps out of the pulpit and organises some sensible tax legislation that assuages his moral outrage. Incidentally, is anyone who put half a million into a tax avoidance vehicle really likely to be in touch with early stage start-up companies? Why does the government regularly pick people that by definition DON’T have the relevant experience?