20 December 2011
(For immediate release)
The Public Accounts Committee (PAC) is right to be concerned about the way large businesses avoid tax, but its report on HM Revenue and Customs hits the wrong target, ARC - the union representing senior HMRC professionals - said today.
Graham Black, President of ARC (the Association of Revenue and Customs), said:
"The problem is not that tax inspectors are 'too cosy' with large business - it is that there are not enough tax professionals in the department to tackle the scale of the tax being lost.
"Yes, the public and the PAC need to have confidence in HMRC, but governance has already been tightened and, as David Gauke the Exchequer Secretary has said, HMRC staff brought in an additional £13.9bn last year. This was despite further cuts in staff numbers, and it is here that the PAC should perhaps focus its attention."
ARC had already put forward plans to reduce the Government deficit by billions, by simply investing a relatively small amount in inspectors, lawyers and accountants.
Black said: "Senior staff strive constantly to treat all taxpayers fairly, but resources are too stretched to battle the major companies advised by an army of expensive advisors.
"I understand the PAC's desire to get at the facts, but taxpayer confidentiality is at the heart of our tax system and should not be ignored lightly. The attacks on HMRC officials have at times been overly aggressive - these are public servants carrying out important and difficult jobs. The real problem has been with successive governments cutting the country's only money-generating department."
Notes for editors
1. The Association of Revenue and Customs (ARC) is a union representing senior staff in HM Revenue and Customs, including tax inspectors, accountants, lawyers, managers and other leading professionals. ARC represents around 2,600 members in HMRC at grade 7 and above, and also trainees in grade 7 entry schemes. It is also a section of the FDA.
2. The FDA is the trade union and professional body representing 18,000 of the UK's senior civil and public servants. Our members include policy advisors, senior managers, tax inspectors, economists, statisticians, accountants, special advisers, government lawyers, diplomats, crown prosecutors and NHS managers.
3. The FDA (formerly the First Division Association) should be referred to simply as "The FDA" and can be described as "the senior public servants' union".
4. ARC published a report Being Bold - a Radical Approach to Raising Revenue and Defeating the Deficit on 8 September 2010. It led the way in urging the Government to increase the number of tax professionals in HMRC to tackle tax cheats and raise funds for the Exchequer. Despite pledges for additional reinvestment (£917m), regrettably, the Government announced a month later that HMRC resources would be cut by 15% over the next four years. This adds up to ten years of successive cuts.
5. ARC members are senior HMRC professionals engaged in work that brings in the majority of the £12bn tax gap closure delivered by HMRC last year. This work is incredibly cost effective. An ARC member earning £50k can expect to generate additional yield of at least £1.5m each year; a return of 30 times their cost. For every £1 of yield the Exchequer benefits by an additional £1 through the deterrent effect of this work both on the subject of the compliance intervention and on those who might be tempted to cheat on their taxes.
6. Graham Black, ARC President, is available for comment.
7. For further information contact:
- Graham Black, ARC President, tel: 020 7401 5559 or 07766 497976.
- Debbie Stamper, ARC officer, tel: 020 7401 5555.
- Graham Flew, ARC officer, tel: 020 7401 5555.