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Inland Revenue cocks up, causing a bankruptcy but is not liable for its mistakes

Posted by James Hammerton @ 6:40 pm on 22 October, 2006.
Categories democracy and the rule of law, British politics, accountability.
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Hat Tip: Tim Worstall

Another example of how unaccountable the various organs of the British state can be, in this case the Inland Revenue which is apparently immune from prosecution and therefore cannot be held liable for its mistakes. From this report in the Telegraph (emphasis mine):

Andrew Simmonds, QC, said that the Inland Revenue had been responsible for a 52-day “negligent” delay that had helped push a builder to the brink of bankruptcy.

However, he ruled that the tax office is immune to prosecution by individuals and businesses, unlike other public services such as hospitals and police forces. Neil Martin, 38, became the first person to sue the Inland Revenue, now known as Revenue & Customs, for alleged negligence or administrative incompetence.

The builder, from Barrow-in-Furness, Cumbria, said that his business had been plunged into a cash flow crisis after a delay in processing a crucial form.

Without the form, part of 1999 anti-fraud legislation called the Construction Industry Scheme, contractors could not pay their bills without subtracting tax at source, which caused a cash crisis for the company.

Mr Martin now faces personal bankruptcy after being left with a swingeing tax bill of £250,000 along with substantial legal costs.

So it seems that if the taxman screws up, the victim of said screw up pays the bill, end of story.

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