A lot of people are interested in the decision of the Court of Session in Advocate General of Scotland v Murray Group Holdings and others. A lot of people.
On the 8th of April, at the height of the 2015 General Election campaign, Ed Balls appeared on the Today programme on Radio 4 to launch Labour’s proposal to ‘abolish’ (as he put it) the non-dom rule. The real question was whether that measure would cost money or raise money. He cited a post on this blog in which I argued that such a measure might well raise £1bn. It was the only evidence he had. I spent the whole day in media studios talking about that £1bn figure.
As I write, that post on the key question around one of the highest profile policies announced in the General Election campaign, a post which has been ‘up’ for over seven months, has been read 6,911 times. And a post about a tax decision of the Court of Session ‘On EBT and Rangers FC – Pt 1‘ has been read 14,246 times. And it’s been up for six days.
Why is that?
Clearly, what is perceived to be at stake is the reputation of the club.
Did it “cheat”, as Alex Thompson and others have argued? Did the club’s directors, by trying to reduce its tax bill, imperil its claim to past titles? Did the club do anything ‘wrong’?
I could offer some answers to those questions.
But my views would be ill-informed: I have not followed the story. To offer them would be crass: I know nothing of Glasgow or its football culture. And my expertise is as a tax lawyer: I’m not a moral philosopher.
But what strikes me is this.
You won’t find the answers to those questions in the decision of the Court of the Session. You won’t find them in whether the liquidators decide to appeal that decision. Nor in a decision of the Supreme Court. Not one that overturns the decision of the Court of Session; and not one that upholds it.
You find the moral quality of an action only in its actors. At what they did at the time and why they did it. The man or woman who drafted the tax code knows nothing of morality. The administrator of BDO cares nothing for football titles. The judges in the Supreme Court seek only to apply the law.
And whatever the directors of Rangers FC lost for its fans, and for Scottish football, when they embarked on an attempt to avoid tax won’t be regained by a legal decision that they succeeded in that attempt. And nor will it be lost afresh by a decision that they failed.
Put shortly, the conduct of Rangers’ directors won’t be bad if the liquidators decide not to appeal. And good if the Supreme Court overturns the decision of the Court of Session. It is what is, either way.
I have campaigned against tax avoidance at some professional cost to myself: you can read about that here.
And I have taken steps to expose the dishonesty of a small number of my colleagues at the tax bar. You can read about that here.
But I have also recognised that a climate in which tax avoidance goes unchecked – and the use of EBTs was then commonplace – can encourage avoidance amongst those who would not otherwise contemplate it.
And that there are circumstances in which even the best informed can find it impossible to ascertain the likely attitude of HMRC to a transaction they are contemplating.
You’ll all have your views on which side of the moral line the conduct of the directors of Rangers falls. It’s not for me to try and change your minds.
Enough for me to identify the right question. Which has got nothing to do with tax law.
Note: I discussed, on Sportsound, last night many of the issues raised by this post. You can listen to the podcast, for a period of time, here.