HMRC Needs Proper Funding, Not Cuts

Jack Humphrey, Regulatory journalist
September 15, 2010 /

According to a senior tax expert, there is a need of proper funding not more cuts.

Head of tax at Baker Tilly, George Bull commented over the demands for extra payments from taxpayers as the permanent secretary at HMRC, Dave Hartnett was all set to testify before the influential Treasury Select Committee.

He said that, the panorama of unexpected tax bills has become an absolute matter of concern for many people. However, the prevailing scenario has shrouded the real issues underlying the turmoil surrounding the PAYE system, the previous week.

In order to avoid reiteration of the problem, there is an urgent need to focus on the issues. Arguably those signs of warning were disregarded as many have described it as a debacle.

Bull further said that the primary cause for the PAYE problems is disinclination of government, so as to fund the highly sophisticated IT system adequately that the HMRC and taxpayers alike need. HMRC has undergone a 15% cut, over merely three years.

We exhort the Treasury to learn its lesson from the PAYE affair and boost up the funding of HMRC with further cuts just around the corner, so that we need not have to witness years of economies in tax administration erupting into crisis, perfectly avoidable!

According to Bull, a growth of just £30m would endow HMRC with an approximated 1,000 additional front-line executive staff, which would upgrade the administration of taxes in the UK.

According to Stephen Herring of BDO simplification was important and that the tax system should be brought in line with the people available to direct it.

He cited an example the Internal Revenue Service of US, where just 100,000 people are employed though it has six times the number of taxpayers as the UK, where HMRC hosts 78,000.


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