Welsh government pays Natural Resources Wales £19m tax bill

The Welsh government recently made a £19m payment to the HMRC on behalf of its environmental agency, Natural Resources Wales (NRW), following a tax probe.

The investigation centred on NRW’s compliance with IR35 regulations, which govern off-payroll working and contractor hiring.

The payment was made as a “without prejudice” settlement while discussions with HMRC continue, and there remains a possibility that the final tax liability could increase.

See also: Appeals process set out for breaches of Welsh NVZ rules

Deputy first minister Huw Irranca-Davies, who doubles as minister for rural affairs and climate change, said the Welsh government is closely monitoring the situation and collaborating with NRW to resolve the issue.

However, the matter has sparked criticism from opposition members of the Senedd, with Welsh Conservative shadow rural affairs minister James Evans raising concerns that the £19m might only be the start of further financial liabilities.

He called for transparency on the total expected cost to taxpayers.

‘Financial burden’

Plaid Cymru member of the Senedd, Llyr Gruffydd, who is chairman of the Climate Change, Environment and Infrastructure Committee, expressed serious concerns about the potential financial burden on Welsh taxpayers, calling for a swift resolution.

Mr Gruffydd stressed the importance of NRW continuing its critical environmental work during this challenging period.

NRW is the largest Welsh government sponsored body, employing 1,900 staff across Wales with a budget of £180m.

It is responsible for enforcing the environmental laws on agricultural activities on air, land and water in Wales.

The organisation is simultaneously grappling with a £13m budget deficit and is considering the future of some of its visitor centres, adding to its financial strain.