I've calmed down a bit now
I don't necessarily disagree with a lot of what you have said - I, too, think those who took the risk with these schemes (differentiating from those who were forced to use these arrangements) took a calculated risk, but where I disagree is that they should have their day in court, which the LC removes. Even the Rangers case implicitly found employers liable (the technical argument being that PAYE should have applied, which employers are responsible for applying).
Well, getting technical, it is possible to move the burden of PAYE onto the individual if they knew, or ought to have known, that PAYE wasn't deducted from their salary. Further, if the amount of the tax isn't paid back (assuming it isn't grossed up by the employer, doubtful in that case) then the employee is still potentially liable for tax.
I do think the LC is significantly unfair for the taxpayer and shouldn't exist for closed years, the UK system is built upon a system of finality. If your tax years are still open then I think the LC is fair game for HMRC.
On the specific point you disagreed with me about HMRC being silent -
I did make clear that HMRC took schemes to court
Again, I think you don't understand the legislative history of disguised remuneration. HMRC has finite resources, and has been challenging,
and winning, cases for decades. The Ramsay line of cases (particularly prevalent in the banking industry with various schemes of avoiding tax for bankers' bonuses) were all to do with some for of disguised remuneration. They established the principle that taxation follows the general interpretation of civil law that legislation is taken with a purposive view and not a literal view (the literal view being favoured by scheme promoters). These were mainly being dealt with in the 2000s (when loan schemes really took off, maybe to do with the fact HMRC was dealing with a different type of scheme at the time?)
In the late 2000s, early 10s, HMRC was dealing with a lot of film schemes, the various Ingenious/Icebreaker schemes are still getting argued today.
The fact HMRC were "silent" on these schemes (which I dispute) has nothing to do with implicit approval and everything to do with finite resources and a tax avoidance market that 20 years ago was enormous. HMRC weren't just dealing with loan schemes, they had abusive arrangements including double tax agreements, film/game partnerships, round the world schemes to name a few off the top of my head.
But this does not discount their silence, otherwise. They didn't start publishing spotlights on the issue until around 2010 when the new DR rules were introduced. And putting spotlights up on a website, which hardly anybody looks at, is not being vocal about their disapproval of schemes. DOTAS registration, despite what HMRC claim now, was used to promote schemes as being "HMRC compliant". At the very least, HMRC could have taken the promoters to task with the ASA - they didn't even do that. Hindsight is lovely, but from 1999 to around 2010, these schemes were being mass marketed and there was barely a peep out of HMRC to the wider contractor community about what their position was on the use of them.
See above r.e. finite resources and what HMRC was challenging in the 2000s. And I don't see how you can blame HMRC for promoters lying. DOTAS was never HMRC approval and the only ones I've ever heard of claiming otherwise are those who fully sit in the "dodgy" spectrum of advice.
And you've conveniently ignored the numerous HMRC letters, which have been published by those caught up in the Loan Charge. Letters which specifically say that HMRC do not have any problem with the arrangements used. In many, MANY cases, HMRC provided tax refunds to scheme users. If they were "always clear" - why did this occur? Sorry, but I stand by my assertion that HMRC were largely silent.
1) I've never seen a letter saying HMRC doesn't have a problem with the arrangements, do you have an example?
2) Refunds are due to HMRC processes, mainly process first check later. HMRC doesn't have the resources to always check before issuing refunds, which is actually why DOTAS was introduced so that they could capture and hold refunds before they were issued. HMRC has long moved on from an organisation with local inspectors who know their areas and taxpayers within them.
EDIT - I do agree with you on the role of promoters in all of this. They have taken advantage of the naivety of a lot of taxpayers, especially those in the social care and public sector, many of whom are lower paid. And they have effectively gotten away with it all - the Treasury Minister Jesse Norman recently said that promoters did nothing illegal and could not be pursued, which is quite frankly, a travesty of natural justice.
I agree, unfortunately justice says that taxpayers can always pursue for negligent advice. Scant help where the promoters are offshore and/or have gone out of business. It's especially infuriating when you see individuals setting up new businesses and carrying on the same old tricks to fleece even more people now.
Edit: anyway, going to have to leave this now, have my own tax advice work to do!