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The UK government has launched a review of the “loan charge” in a bid to “end” the dispute over tax evasion that has been linked to a number of suicides.

Treasury minister James Murray told the Financial Times that the impetus behind the review, Office has partnered on Thursday, is to resolve outstanding tax debts related to avoidance schemes.

But he added that the review, which will be led by former HM Revenue & Customs inspector Ray McCann, “will also continue to be fair (to) the public purse” and other taxpayers who are not involved in tax evasion.

“Some of the people who are affected by the loan payments find it difficult to imagine a way out of this situation they are facing. . . For me trying to resolve and end the matter for them was a driving force for this review,” Murray said in an interview before the announcement.

In 2019, then Tory The government introduced the “loan charge” in an attempt to crack down on “disguised payment” schemes, which involve workers in various sectors being paid for by loans through offshore trusts and have proliferated in the past two decades.

HMRC have said before around 50,000 people are estimated to be affected by the loan charge and that users’ incomes are “on average twice that of the average UK taxpayer”.

The loan bill originally obliged affected people to pay taxes on up to 20 years of income in a financial year, sparking a public outcry and accusations that the government was issuing unreasonable demands.

The previous Tory administration later softened the policy, halving the 20-year timeframe and speeding up the spread of payments.

But six years on from the policy’s launch, thousands of people have yet to settle their affairs with HMRC. The tax authority reported that the policy was linked to at least 10 suicides and 13 suicide attempts.

Labor committed to a new independent review of loan payments before last year’s general election. A previous report by Lord Amyas Morse in 2019 was criticized by MPs and campaigners for involving Treasury and HMRC officials.

Murray said the government was “going to some lengths” to ensure public confidence in the review, which will run until the summer and is staffed by civil servants with no connections or experience working in policy. in loan payments. They will work in a building separate from the Treasury.

McCann, a former president of the Chartered Institute of Taxation, said he was “delighted to be asked to help find ways” to resolve the dispute.

McCann has previously criticized how HMRC seeks to engage with payday loan campaigners, saying “all the people (within the agency) who work on loan schemes could be working in customer service”. .

In a statement the government said the review would examine “the barriers that prevent those subject to loan repayments from reaching resolution with HMRC and recommend ways in which they can be encouraged to do so”.

Campaigns that require an extensive review – looking at the role of scheme developers, umbrella companies, recruitment agencies, accountants and tax advisers who recommend schemes, as well as HMRC – hit notice.

Steve Packham, of the Loan Charge Action Group, said the proposed review was a “betrayal” and “will not resolve the matter”.

“We are very concerned about the impact on mental health that announcing this non-review will have,” he added.

Murray said his meetings with payday loan campaigners last year had alerted him to the impact of the policy and that the government wanted the McCann review, to which it would respond in the Autumn Budget, to “provide a way for taxpayers affected to come to a settlement” .

Despite some asking “for a review with a different scope”, Murray added that his priority was to “help people who feel stuck”.