The amount of energy that taxpayers invest in criticising HM Revenue &
Customs for its ‘aggressive’ approach to collecting tax would suggest that never
before has the taxman been so draconian.
The complaint statistics in the Revenue’s 2005/2006 annual report, however,
indicate that all the fuss made about a meaner
HMRC may be overblown.
Yes, HMRC did receive an increase in complaints from 93,754 in 2004/2005 to
106,783 in 2005/2006. This rise was mainly due to a sharp increase in tax credit
office gripes, which climbed from 47,921 to 62,686. In most other areas
Direct tax complaints, for instance, dropped from 22,559 to 21,273. Only
3,758 taxpayers complained about indirect tax compared with 4,042 a year
earlier. National insurance complaints also plunged, from 7,176 to 4,092.
So if complaints in the majority of key tax areas are falling, why do
taxpayers and advisers feel that the taxman has been playing tough?
Bernard Sweet, corporate tax director at Chiltern, said he found the figures
puzzling given the anecdotal evidence suggesting the relationship between taxman
and taxpayer is not as warm as it used to be. Sweet said the merger between
Inland Revenue and Customs and Excise could have had an influence on the
‘Some of the figures are difficult to marry up, but that is understandable as
they were still thinking in terms of Inland Revenue and Customs,’ Sweet said.
Even Richard Murphy, the anti-avoidance campaigner from Tax Research, said
the complaint figures were surprising.
‘Some of the numbers are quite baffling. I would have expected complaints for
tax credits to have dropped because of all the work that has been done in that
‘HMRC has become more pragmatic about pursuing enquiries, which may have
something to do with the downward trend, but I am surprised about the fall in
the number of complaints in certain areas,’ Murphy said.
One figure that did not come as a surprise to most advisers was the
complaints made to HMRC’s large business group. Over the year complaints from
large businesses climbed significantly from one in 2004/2005 to eight in
The increase in complaints from big corporates follows the CBI’s criticism of
the complexity and competitiveness of the UK system, and frustration over the
way the government has responded to adverse tax rulings from the European Court
Does Darwin's theory apply to taxation? Colin ponders...
The UK tax gap fell in 2014-15 to its lowest-ever level of 6.5%, revealed official statistics published today
Changes to the tax system is urged to support the growth of entrepreneurs, found a report from the Grant Thornton UK, the Institute of Directors, and the Prelude Group
The EC has been instructed to draft a European Union (EU) directive authorising an EU financial transaction tax, which would apply to ten of the EU’s 28 member states