A row blew up today between the country's biggest civil service union and HM Revenue and Customs over claims that more than 90 offices across the UK are to close, with the loss of 3,400 jobs.
The Public and Commercial Services union said details of the cuts, to be made by 2011, were given to staff today, and expressed "deep concern" that the ability of the department to collect revenues and provide tax advice to the public and local businesses would be undermined.
HMRC accused the union of "scare-mongering" and maintained that no job cuts had been announced, adding: "What we have announced today is the last in a series of decisions in HMRC's regional review of office structure. Those offices which are going to close will be vacated on a phased basis with staff moves expected to start in spring 2009."
Union leaders said the department was being "disingenuous" and insisted that the office closures and job cuts were being revealed for the first time.
Officials said services were already suffering with a drive to axe 25,000 jobs and close more than 200 offices, leading to backlogs of post and claims that the department can only chase up those who owe £20,000 or more in tax due to a lack of resources.
The union said regions affected by the announcement will include: Eastern - 18 offices to close and 800 jobs to go; South West - 19 offices, 835 jobs; Yorkshire and Humber - nine offices, 400 jobs; Northern Ireland - five offices, 190 jobs; Scotland - 20 offices, 400 jobs; Wales - 11 offices, 470 jobs; North West - 11 offices to close.
PCS general secretary Mark Serwotka said: "In these uncertain economic times, these closures and job losses will hit businesses, the public and the communities they serve. Rural areas will be disproportionately hit, with face-to-face tax advice reduced to a bare minimum and quality jobs taken out of local economies.
"As the recession worsens, this will come as a bitter blow to a dedicated workforce and will lead to a loss of valuable knowledge and expertise.
"Job cuts are already damaging the ability of HMRC to function and undermining public confidence in the department. Office closures and job cuts will do nothing to tackle the £21.5bn-worth of uncollected tax and £25bn lost through tax evasion.
"The Government has to recognise that the erosion of public confidence can only be halted by having enough civil and public servants with the right resources to do the job.
"As the recession deepens and people become more reliant on public services, the department and the Government should stop adding to the growing number of unemployed and call a halt to the office closure and job cuts programme."
An HMRC spokesman said: "Since HMRC's merger, staffing numbers have reduced by around 17,000 from around 105,000. This is part of a well-publicised strategy to improve HMRC's efficiency by 5 per cent year-on-year up to 2011.
"So far, HMRC has achieved all staff reductions and efficiency targets without compulsory redundancies and it remains our intention to avoid them wherever reasonably possible."
Tax experts at accountancy firm, Baker Tilly, said office closures would have a negative impact on businesses.
George Bull, Baker Tilly's head of tax, said: "This announcement, while devastating for HMRC staff, will also be a significant blow to businesses and individual taxpayers who already see long delays in processing tax refunds and receiving satisfactory replies to simple questions.
"To date, HMRC have failed to convincingly make the transition to online or automated tax return processing.
"This significant head count reduction will inevitably compromise its service to customers.
"Just like supermarkets who now train their shoppers to act as checkout executives, with decreasing resources HMRC will have to outsource the capacity shortfall to their customers."Reuse content