Friday, 1 April 2011
HMRC to tax Monopoly income
A government sponsored amendment was tabled this morning to the Finance (No. 3) Bill currently before parliament under the innocuously title of "Clarification of applicability of certain treaties". It looks like HMRC are seeking to rely on Article VIII of the IMF treaty to enforce conversion of all type of fiat currencies within their jurisdiction.
The HMRC argument is of course solid. Monopoly money has exactly the same backing as Sterling and they are, of course, much more interested in people earning £200 salaries than £2 million since at that level you can't afford clever lawyers and accountants to cause HMRC any trouble (like having to think before they act).
As it says in the notes accompanying the release "We expect people enjoying themselves for several hours on wet Sunday afternoons to pay their fair share of tax"
We have seen this sort of underhand trick before. HMRC introduced the IR35 legislation in much the same way. There were indications throughout the opposition years that the government would scrap IR35 when they got into power, but as usual what you say when seeking a vote is not what you do once you've got it.
About the best we can hope for now is that the exchange rate between Sterling and Monopoly cash will deteriorate further, which will probably happen given the government's current plans to run the country into the ground.
For more details see the press release