The First Division Association is the union for all the UK’s most senior civil servants: the Association of Revenue & Customs its division for the senior manghers in HM Revenue & Customs. It issued a press release yesterday to lunch its tax gap campaign, which said:
While the Comprehensive Spending Review threatens HM Revenue and Customs (HMRC) with cuts and job losses, it actually makes more sense to invest in the department that brings money in, the Association of Revenue and Customs (ARC) said today. ARC is the union representing senior managers and professionals in HMRC, and it today launched a campaign designed to highlight how more Government revenue can be generated.
Graham Black, ARC President, said:
"It is madness to reduce HMRC still further, when it has already suffered 30% cuts in recent years. With more staff, we can bring in more of the tax that is legally due, and deal with the tax cheats who are putting the burden onto everyone else.
"The Government is like a drowning man who decides to throw off his life jacket, because it weighs too much. Who in his right mind would recommend that?
"The amount of money spent on dealing with the tax gap has almost halved since 2006-07 from £3.6bn to £1.9bn, and at the same time the revenues collected by HMRC have fallen by £25bn.
"Every pound spent on dealing with tax cheats will bring in at least 30 times that amount - and that is an investment opportunity any logical person would take.
"And with the additional income, the Government's options increase: they can reduce the deficit more quickly, or protect key services. Now is the time for a truly bold decision, one that is right for the country, and one that makes both economic and moral sense."
ARC is holding a meeting for MPs at Westminster on 8 September 2010 to outline the case in more detail.
I welcome them to the fray.
I am delighted that the senior managers of HMRC buy the logic of an argument I started promoting in 2006. Then it was an unknown issue. Now it is a significant alternative mechanism for tackling our current financial crisis. And it’s good to see that HMRC manages agree that much more could be done to tackle it.
In that case the real question is why won’t Osborne do anything about it?
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No wonder we can’t afford the Taxmen when the senior Mahngers have lunch campaigns. 😉
Keep up the good work Richard, I like telling all the Tories at work how many tax scams there are and that they’re really funding it all.
Surely these days the First Division Association should be called the Premiership Association?
But seriously, this is v good news.
Meanwhile, Osborne is blathering away about the “choppy recovery” – WHAT recovery? His policies will ensure we don’t get any. 👿
I know there are many complex economic arguments around the deficit, the need to spend, credit rating etc. But if you take the simplistic view the ConDems are trotting out that there is a deficit because spending is more than income; and that deficit needs to be reduced; then instead of cutting spending why not raise income?
They are not even trying to raise income – the deficit is a smokescreen to implement ideologically driven savage public service cuts.
Ravi
PS Richard I have emailed you separately about using your work on the true costs of making a public sector worker redundant.
Richard, would you happen to know approximately how many people are working in the tax avoidance industry? There must be quite a few people with valuable knowledge of significant tax avoidance or evasion, who are in agreement with you about the damage that is being done to the economy in this way – and who would be willing to supply HMRC with information that would have a significant effect on the UK tax gap. In the USA, the IRS have recognised this by introducing the “Tax Whistleblower Program” which provides proper compensation for those people who risk losing their jobs and who might compromise their personal safety by doing just this. There is a mandatory requirement for the IRS to pay a minimum of 15% of the collected proceeds, with a maximum of 30% and no ceiling.
Perhaps HMRC need to introduce such a scheme. They are aware that the revenue collected in the recent Liechtenstein case was out of all proportion to the costs involved in obtaining the information. The Permanent Secretary for Tax has himself commented publicly that the productivity per head of staff in those cases where informants are involved is in a different ball park compared with the investigations where they are not. It is an extremely efficient use of personnel.
In the UK there is a healthy scepticism surrounding the issue of informants, and perhaps we do not like to create instant millionaires in quite the same way as the USA does. So no doubt there would be resistance to the idea in some quarters. But which is the lesser evil? Mass public cuts, or collecting the right amount of tax in the first place. It doesn’t have to be 15% to 30%, it could be some other much smaller percentage to allow for the British reticence on this issue. The point is that the payment would be strictly by results and the person concerned would know that they would be remunerated accordingly.
Even a lesser program with minimum features such as a publicised scale of payments and a transparent policy could possibly have a significant impact. Currently HMRC have no open door for those who wish to report significant tax fraud, no transparency, very little encouragement and the informant has no certainty how they will actually emerge from engaging with HMRC.
Public spiritedness alone might bring forth a trickle of information, but for the real results some encouragement might be needed.
Richard, perhaps I could make a small correction – when I said which is the lesser evil “Mass public cuts, or collecting the right amount of tax in the first place”, I meant “Mass public cuts, or making payments to those who can assist”.
[…] following comment is one that does deserve that wider attention, being made this morning on yesterday’s story the the Association of Revenue & Customs (a […]
Why not introduce a simplified and flatter tax system. That way we’ll need far fewer tax calculators, far fewer civil servants and there will be far fewer avoidance schemes. Surely a win/win/win?
[…] following comment is one that does deserve that wider attention, being made this morning on yesterday’s story the the Association of Revenue & Customs (a […]
@Stuart
No – that’a panacea for avoiders
See http://www.accaglobal.com/pubs/general/activities/research/publications/tech-ft-001.pdf