Revenue awaits bruising PAC attack
The Inland Revenue is to face a bruising encounter next month when the department releases its annual report and chairman Sir Nick Montagu is dragged back in front of the House of Commons Public Accounts Committee.
Link: Revenue slammed over huge overpayments
The annual report is expected to include a chapter on the chaotic implementation of the new tax credits, following hot on the heels of last week’s National Audit Office report on the Revenue accounts.
The NAO report chastised the Revenue for overpaying working families’ and disabled person’s tax credits for the year 2000-01 to the tune of somewhere between £510m and £700m.
In total, NAO head Sir John Bourn estimated that as much as £2bn has been overpaid since 1999. As a result, Sir John decided to qualify the Revenue’s accounts: ‘The significant level of overpayment of working families’ and disabled person’s tax credit – potentially some 10% to 14% – is cause for serious concern, and I have qualified my audit opinion.’
Edward Leigh, chairman of the PAC, said: ‘The report provides sobering reading for the taxpayer. This terrible waste of money is one side of the coin. The other is the disastrous introduction of the new tax credits system earlier this year, which has caused unnecessary suffering to a large number of genuine claimants.’
Although the implementation of this year’s new tax credits was mentioned in the report, Accountancy Age understands that the annual report will provide further insight into the problems. Montagu will face politicians on the influential public accounts committee on 3 December.