UK campaign group loses challenge on tax deal

AP News
Posted: May 16, 2013 5:56 AM

LONDON (AP) — A U.K. pressure group Thursday lost its legal challenge to what it called a "sweetheart" tax deal between U.K. authorities and Goldman Sachs.

UK Uncut Legal Action, which campaigns against tax avoidance, had sought a High Court declaration that it was unlawful for the U.S.-based investment bank to avoid a multimillion pound interest bill on unpaid tax on bonuses.

Judge Andrew Nicol ruled that the decision was not unlawful even if it was not a "glorious episode."

The campaign group had claimed the deal cost taxpayers 20 million pounds ($31 million), though the potential cost is officially put at 8 million.

UK Uncut claimed the agreement struck between the U.K. tax authorities and Goldman was illegal because of the requirement that all taxpayers be treated equally. It also said the deal bolstered corporate profits at a time when the public is coping with the demands of a prolonged austerity drive.

Although it lost in court, UK Uncut claimed it had won a "major victory" because the judge criticized many aspects of the way the case was handled by revenue officials.

"Despite not having won the case today we still feel that this judgment has demonstrated that the government is making a political choice to cut legal aid, public services and the welfare system, rather than take action to make corporate giants like Goldman Sachs, Amazon or Google pay their fair share of tax," said Anna Walker, the group's director.

HM Revenue & Customs argued that a National Audit Office report last year has bolstered its position by finding the tax deal "reasonable."