Why Gary Barlow has done nothing wrong

12 May 2014

A leading tax expert has described the furore over Gary Barlow's tax affairs as "misplaced and morphing into a witch hunt".

The Take That frontman, along with band members Mark Owen and Howard Donald, face having to pay back tens of millions of pounds in tax relief after being found to have invested in a tax avoidance scheme.

Along with their manager and as many as 1,000 other investors, they were alleged to have invested in a company that was said to be supporting creative industries. When the company posted massive losses, investors were then able to offset this against their tax bills, reducing the amount they had to pay HMRC.

A tribunal has found the company to have been a tax avoidance scheme and Margaret Hodge, chair of the public accounts committee, has since called for Barlow to be stripped of his OBE.

However, Kevin White, head of financial planning at IFA firm deVere United Kingdom, said: "The judge in this case has declared that the investors involved were part of a tax avoidance scheme.

Not a crime

"Let's be clear: tax avoidance is not a crime, tax avoidance is legal and can form part of a competent financial strategy. On the other hand, tax evasion is illegal and therefore punishable under the law."

As such, White said questions should be asked as to why Barlow and his fellow bandmates are now facing such a big tax bill.

"It is ludicrous to suggest, as it has been, that he [Barlow] was 'getting away with' not paying his taxes. You cannot 'get away with' something that is legal. Mr Barlow and others were attempting to legally mitigate their tax burden."
Rather than vilify the singers, White added it would make more sense to bring about a change in the law.

"Those who object to such schemes, instead of launching a witch-hunt against high profile individuals and/or companies to perhaps push their own agendas, should instead lobby MPs – who are the ones who have the powers to change this country's overly complex and sometimes ambiguous tax laws.
"Perhaps there is a case to modify the rules, but lynch-mobbing in the media a few pop stars is not the appropriate, sensible way to go about it. We need a considered national debate."

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