In this week’s PAC (Public Accounts Committee) hearing, the HMRC informed MPs that BBC is to be blamed for the tax controversy which resulted in the suffering of freelance presenters. These presenters had to contend with the reform’s retrospective nature.
Jim Harra from the HMRC pinned the blame on BBC and labelled their practices, which are used to determine employment status, as “quite a bit adrift.” Mr. Harra was clearly trying his best to justify CEST-based irregularities which are compared to pre-CEST assessments.
Last November, a report from NAO (National Audit Office) unveiled that an astonishing 92% of around 663 freelancers in BBC with the employment status of “employed for tax purposes.” These findings deviated to a great extent in comparison to BBC’s prior employment status techniques.
Mr. Harra was inquired about the veracity of CEST-based results where he put BBC and its practices in spotlight. These practices include adherence to HMRC’s guidelines and their execution of evaluating employment status
According to Mr. Harra, BBC and HMRC have been collaborated extensively for several years and HMRC has offered guidance to BBC in accordance with the media industry.
While BBC has accepted the blame in the tax scandal, HMRC remains firm and is not willing to accept the shortcomings of its highly-controversial CEST. As evident by Mr. Harra’s responses HMRC has shifted the entire blame to BBC and made it appear as if BBC’s incompetence is to blame for the tax fiasco.
Going by this strategy to protect CEST, Harra explained to MPs that the outcomes of CEST depend on its input. He also ensured that CEST approval does not always mean that HMRC will clear a case—if they find anything amiss, then they may investigate.
Mr. Harra was asked about tips for using CEST for hiring companies where he stated that“They need to have systems and processes in place that will withstand our scrutiny. What we will look at is the process that businesses follow internally to make sure that they are entering the true facts into the tool.”
Despite his fierce defence of CEST, he ultimately could not make CEST credible as questions on its testing history and accuracy kept piling up. He admitted while CEST was passing the testing phases, it was not forced to be passing any set threshold to be declared as suitable for working.