The Supreme Court has upheld the appeal of a company and its CEO regarding the scope of the duty of confidentiality owed by HMRC in respect of taxpayers’ affairs. The case concerned an interview given by a senior HMRC official to reporters from The Times regarding tax avoidance schemes allegedly carried out by the appellants.
One of the case’s main issues concerned the scope of the exception contained in section 18(2)(a) of the Commissioners for Revenue and Customs Act 2005, which allows for disclosures made “for the purposes of a function of the Revenue and Customs”. The court held that this must be interpreted narrowly and as permitting disclosure only “to the extent reasonably necessary for HMRC to fulfil its primary function”. It therefore found that HMRC’s reasons, which included a desire to foster good relations with the media, could not possibly justify the disclosure in question.
The Supreme Court also rejected the view of the lower courts that the decision to disclose was a matter for HMRC and that it was not their place to review the facts as though they were the primary decision makers. In doing so, the court emphasised the “cardinal error” of assuming that the principles of judicial review occupied the entire legal field and stated that “public bodies are not immune from the ordinary application of the common law, including… the law of confidentiality”.
