HMRC needs more resources – ARC chief

THE PUBLIC ACCOUNTS COMMITTEE must recognise HM Revenue & Customs’ need for greater resources, according to the head of the union representing the department’s senior staff.

HMRC needs “the tools to allow it to crack down on avoidance and evasion”, Gareth Hills, president of the Association of Revenue & Customs (ARC) said.

Earlier this week, the Public Accounts Committee – chaired by Labour MP Margaret Hodge (pictured) – released a report entitled Tax avoidance: tackling marketed avoidance schemes, claiming promoters of tax avoidance schemes are “running rings” around the taxman and calling for it to embark on a “name and shame” policy to discourage the practice.

The committee report warned that the taxman was losing the “game of cat and mouse” to clients and promoters of tax avoidance schemes as they deliberately take advantage of the time it takes HMRC to shut down a particular method.

While ARC welcomed Hodge’s name and shame suggestion, Hills warned legislative change would have to take place, adding the body had “argued consistently that securing the right amount of tax is more vital than ever”.

To that end, he said, it is “disappointing” the committee placed little emphasis on providing HMRC with further investment “over and above” the £77m announced in last year’s Autumn Statement.

“The scale of the overall budget deficit of £126bn, and the tax gap of £32bn, are such that the government needs to put significant investment into HMRC,” he said. “Even relatively small scale investment of £120m would recoup currently lost tax of £3.7bn.”

Related reading