Conspiracy theory of the week

You will no doubt all remember that the heavily indebted ruling Labour Party received a welcome surprise £4.6 million VAT refund (on the back of a case regarding VAT on staff expenses originally brought by Conde Nast and Michael Fleming) on 22 July 2009.

Of course, it would raise eyebrows if only The Labour Party were to benefit from the taxman's sudden largesse, so the taxman announced that it had set aside £5 billion to cover payments to other organisations with similar claims. The recruitment agency Michael Page, for example, announced in a rather curt press release on 16 June 2009 that it had received a £26 million VAT refund (on which it later received another £11 million interest. A further claim of £80 million under the same principles never materialised).

OK, three months later, the dust has settled and everybody's forgotten about the Labour Party's refund (or so they hoped), so the taxman is now going round reclaiming the refunds from all the other organisations (which were only made to provide operational cover for bailing out The Labour Party).

See for example, this article in today's Times:

Michael Page International... Britain's second-biggest recruiter, was warned by the Inland Revenue last month that it was "considering taking steps" to recover £37.4 million which it had handed over as a part settlement of an alleged overpaid VAT bill.

Please keep a look out for other such clawbacks!