Funding the Nation: Optimising HMRC – FDA hosts leading tax experts to discuss new report
The FDA was pleased to host a panel of the UK’s leading tax experts to discuss the findings of our landmark report, which suggests targeted investment in HMRC could deliver an additional £11.3bn for the treasury.
The report – Funding the Nation: Optimising HMRC – was produced by the Association of Revenue and Customs (ARC), the FDA’s section for members working in HMRC.
Launching the report in Parliament, ARC President Loz Hutton was joined by Emeritus Professor of Taxation Law at Oxford University Judith Freedman and Chair of the Economic Affairs Finance Bill Sub-Committee Lord Leigh of Hurley to discuss its findings and recommendations, in a panel event chaired by Former Executive Chair and Permanent Secretary at HMRC Sir Edward Troup.
Funding the Nation calls for large scale investment into compliance and customer service to help close the tax gap. It estimates that an investment of £910m would return £11.3bn into the treasury over the course of a parliament.
The key findings outlined by the report were discussed in depth by panelists. These included:
- The direct cost of HMRC’s current 24-minute average customer hold time and poor postal services is estimated to be costing UK businesses around £1bn per annum
- A survey of HMRC staff found that 15% of the workforce lose more than four hours to poor technology each week (10% of their working time)
- Across the whole department, HMRC staff lose more than 4 million working hours to poor technology each year
- Using historic yields as a guide, ARC has modelled that if the UK government invested £700m into its compliance regime, with a further £210m into its customer services, it would expect to raise £11.3bn for the next government over a parliament
Key recommendations proposed by the report were also debated:
- Large-scale investments into compliance, with an equivalent investment in customer service to close the tax gap
- A long-term staffing and skills plan
- An ongoing technology plan
- A clear data strategy
- Develop a clearer strategy for tax administration
“I hope the Public Accounts Committee pick it up… And maybe we should debate it in the House of Lords,” he added.
Judith Freedman commented that she was “very supportive of the recommendations” in the report and “looking forward to working with ARC” to progress them, while also offering a word of caution on AI strategy, which she believes at the moment is “very high level”. She stressed it must be linked “to what’s happening day to day”, with transparency about how and when it will be used in the tax system.
The launch was attended by former Assistant Director of HMRC Ray McCann, Director of TaxWatch Claire Ralph, ICAS Head of Tax Chris Campbell and ACCA Head of Policy Glenn Collins.
Loz Hutton told ARC members he hoped Funding the Nation “would provide a blueprint for a future government, of any political persuasion, for how to get the best from HMRC and its adaptable, hard-working staff”.
Responding to the report, FDA General Secretary Dave Penman drew attention to the report’s findings “that HMRC’s workload has changed significantly over the last decade to mirror changes in the wider economy, as well as demographic pressures”.
“The number of taxpayers is increasing and HMRC now manages more complex tax administration, and more frequently, than it has had in previous decades,” he explained. “The department’s ability to adapt to this ever-increasing workload is a success story but civil servants simply can’t keep on delivering more for less.”
He also argued it was “completely unacceptable” that some FDA members in HMRC reported losing hours of working time every week because of poor technology.
“As we approach the upcoming general election, I call on all political parties to take these recommendations on board and pledge to properly invest in HMRC,” Penman continued. “A world class tax administration is in the public interest. Only an HMRC that is properly resourced to face new technological challenges, stay ahead of criminals and support taxpayers will deliver the revenues that can support our economic recovery and be able to give the government choices about investing in growth.”
You can read the full report and find out more about the Funding the Nation campaign at www.fundingthenation.org
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