Morecambe Co-Chairman says EFL embargo relates to a ‘highly unusual VAT matter’ and unrelated to club sale

The Morecambe FC Co-Chairman has responded to the news that the club is under an embargo after issues relating the money owed to HMRC.

Graham Howse says the EFL embargo relates to a ‘highly unusual VAT matter’ and is unrelated to the current ownership of the club.

‘’The matter relates to VAT and is a highly unusual circumstance whereby the club is actually paying sums due in advance of those monies being due back to the club,’’ said Mr Howse in a statement.

‘’The matter has nothing to do with the current sale of the club and its ownership. Due to the way the matter is being orchestrated by HMRC, it has been reported to the EFL and, under the rules, triggers an embargo.’’

‘’The EFL are, and continue to be, in dialogue with the club and are communicating with HMRC who are fully appreciative of the highly unusual circumstance and have been supportive of the club.

‘’To try to put it in simple terms, we have to pay for something where we have done nothing  wrong before we are refunded, so essentially, paying for something twice.

‘’We hope to get the matter resolved as soon as possible.’’

The Shrimps have failed to comply with English Football League regulation 17.3 – relating specifically to amounts due to HMRC.

The embargo means that the club are prevented from strengthening the team or adding to playing staff costs until such time as it has met its existing financial obligations and/or the club has rectified the relevant breach to the EFL’s satisfaction.

Embargoes are intended to operate as a deterrent against clubs defaulting on financial obligations to clubs or players, or breaching other key relevant regulations, such as reporting on financial matters.

It’s understood that the embargo has been in place since last Wednesday.