UK Tax Authority Drops Case Against Tariq Mir, Former MQM Leader

LONDON: His Majesty’s Revenue and Customs (HMRC), the UK’s tax authority, has concluded its case against Tariq Mir, previously a senior figure in the Muttahida Qaumi Movement (MQM). Additionally, HMRC has contributed to his legal expenses while continuing its pursuit of other prominent MQM leaders, including founder Altaf Hussain.

Mir asserted in court that he was not liable for MQM’s debt to HMRC, which totaled £1,476,406.08, and that he did not receive the claim form sent by HMRC.

The court took Mir’s argument into consideration, and the judge ruled in his favor, nullifying the default judgment against him. Subsequently, Mir challenged HMRC’s initial decision to hold him accountable for MQM’s tax obligations at the Tax Tribunal.

Prior to a hearing, HMRC ceased the proceedings and consented to cover part of his legal fees, which have now been disbursed.

Although the case against Mir has been discontinued, HMRC is reportedly still trying to recover the outstanding tax from Altaf Hussain.

HMRC has secured charging orders against two properties under Altaf Hussain’s name, amounting to £1,525,794.52, inclusive of interest on the original debt.

Altaf has contested one of the charging orders, arguing that the property is held in trust for MQM and that he possesses no beneficial interest in it. Concerning the second property, his stance is that he owns it personally and that it should not be used to settle MQM’s debts. Altaf Hussain has also requested that the judgment against him be set aside.

In August 2013, HMRC initiated an investigation into MQM’s tax matters following information received from the Metropolitan Police Service regarding MQM making payments to some members without deducting appropriate tax.

The case originated during the Met Police’s investigation into the murder of Dr. Imran Farooq in London. Simultaneously, the police initiated a money-laundering investigation into Altaf Hussain, which was later dropped due to a lack of sufficient evidence for prosecution.

In September 2016, HMRC issued 14 Notices of Determination against MQM for the tax years spanning 1997 to 2011. In October 2016, MQM appealed these notices; however, the appeals were unsuccessful. In June 2020, HMRC issued an additional seven Notices of Determination for the tax years 2012 to 2019.

HMRC’s investigation centered on payments made to several party members, including Altaf Hussain. MQM contended that the payments to Altaf were gifts, given his leadership position within the party.

HMRC dismissed this argument, stating that the payments represented living expenses and were therefore subject to taxation. HMRC cited a letter in which Altaf Hussain requested party members to raise £1.5 million for his divorce settlement, indicating that his only “income” was derived from the party.

Due to the non-payment of the required amounts, HMRC filed a debt claim against four MQM officials it considered responsible. On June 5, 2023, HMRC obtained a default judgment against Mir, Altaf, and two others for £1,476,406.08.

Mir asserted that he was unaware of HMRC’s claim, having left MQM roughly ten years prior. He maintained that he was never an employee of MQM and was not involved in its financial affairs, therefore he should not be personally responsible for any tax owed by the party.

In his application to set aside the default judgment, Mir informed the court that he had joined MQM as a volunteer, driven by a desire to contribute to the country through health and education initiatives.

He stated that this passion guided his work at MQM, exemplified by his involvement in establishing a reference library for students, a charitable school serving over 1,100 students, an operational university, and both a children’s and general hospital in Karachi and Hyderabad.

The hearing for Altaf’s application to set aside the judgment and challenge the interim charging orders is scheduled for May at the County Court at Barnet. Altaf Hussain has refuted any liability and maintains that he owes no taxes to HMRC.

Tariq Mir was represented by Stone White Solicitors and Old Square Tax Chambers.