OUTLOOK: Either give HMRC the budget to pursue tax dodgers or ask less of it
Jim Armitage is the City editor of The Independent and London Evening Standard group of newspapers. He has been a reporter and editor for more than 20 years and was recently shortlisted for the Press Gazette financial journalist of the year and The Society of Editors financial journalist of the year awards. He contributes news, investigative reports and comment to the Independent titles plus a daily column in the Evening Standard.
Thursday 19 December 2013
Outlook The Public Accounts Committee is angry, very angry, at HMRC's failure to prevent tax dodging.
HMRC must, it declared, be more aggressive in its prosecutions of major multinationals. It must ensure no more "unintended consequences" emerge when it changes tax rules (er, but if they're "unintended" you don't usually spot them first). It must demonstrate how robustly it has dealt with miscreants. It must do more to grab cash from Swiss bank accounts. And so it goes on.
The committee is right to be frustrated at the failure of our tax collectors to be able to plug every loophole and grab every penny squirrelled away from the Treasury's paws. But it is wrong to lay the blame so entirely on the taxman's lap.
HMRC is, after all, an organisation which we ask to fight the cleverest, highest paid tax lawyers and accountants in the world. Men and women who are paid fortunes to beat the system by the richest people and the biggest corporate entities on the planet.
And what do we give our humble taxman to take on these dodgers? A shrinking budget and salaries that would barely cover the average PwC partner's après ski this Christmas.
In the autumn statement last year, HMRC was told it would not face any cuts in its budget so it could focus on raising more from the tax evaders. Six months later, it was ordered to slash £100m off its 2014 bills. Simultaneously, it was told to raise £1bn more in taxes.
And in this month's Autumn Statement, it was ordered to raise £3.7bn more in avoided tax by the end of the 2015. On top of that, more loopholes were closed to raise billions more. Great news, but where was the extra money for HMRC's bowler hats to go about collecting it?
The biggest problem with the way we treat the taxman is the outlandish predictions politicians put on how much tax their anti-avoidance plans will raise. Year after year, they massively overpromise, leaving the HMRC constantly looking lazy, incompetent or both.
The fact is, we have to be more realistic: either we give the taxman the budget to pursue his investigations or we ask less of him.
- 1 Isis 'jihadi bride' claims forced sex with Yazidi girls is never rape because Koran condones it
- 2 Woman accidentally shoots herself in the head while posing for a selfie
- 3 Art Garfunkel calls Paul Simon a 'monster' with a Napoleon complex
- 4 Isis burns woman alive for refusing to engage in 'extreme' sex act, UN says
- 5 Puerto Rico, island of lost dreams: People are leaving the debt-hit territory in droves as near neighbour Cuba's star rises
Isis 'jihadi bride' claims forced sex with Yazidi girls is never rape because Koran condones it
Woman accidentally shoots herself in the head while posing for a selfie
Isis burns woman alive for refusing to engage in 'extreme' sex act, UN says
Puerto Rico, island of lost dreams: People are leaving the debt-hit territory in droves as near neighbour Cuba's star rises
16-year-old girl beaten and burned alive by lynch mob in Rio Bravo, Guatemala
As a white man, I'm surprised more women aren't tweeting the hashtag #KillAllWhiteMen
Scotland may have to leave the EU even if it votes to stay in, David Cameron confirms
The day that Britain resigned as a global power
Almost a third of school pupils believe 'Muslims are taking over our country', study claims
SNP fury as HS2 finds 'no business case' for taking fast train service to Scotland
Gay marriage 'Bert and Ernie' cake bakery found guilty of discrimination in Northern Ireland
iJobs Money & Business
£40-50K: Guru Careers: We are seeking an experienced Software / C# Developer w...
£45,000 - £55,000: Neil Pavier: Are you looking for your next opportunity for ...
£45,000 - £55,000: Sheridan Maine: Are you a newly qualified ACA/ACCA/ACMA qua...
£50,000 - £60,000: Laura Norton: Are you looking for an opportunity within a w...