Why can’t HMRC’s senior management tell the truth?

Posted on

HMRC have obviously issued a press briefing that is breathlessly reported as follows by the FT:

HM Revenue & Customs raked in £1.1bn from challenging the pricing of multinational companies’ internal deals in 2013-14 – more than twice as much as in the previous year.

Much follows on the impact of additional staff, and more.

But there's a problem. This comes from a press briefing issued by HMRC in April 2013:

HMRC’s transfer pricing investigations have generated more than £4 billon in extra tax revenues over the last four years.

Given the timing of its issue this presumably covers the tax year 2012-13.

And if I divide more than £4bn by four I come to the unsurprising number of more than £1bn.

And the £1.1bn collected in 2013-14 is not double £1bn, however it is looked at. In fact, it looks remarkably like the same number, meaning the new resources HMRC have put to use have apparently achieved no net gains at all.

So, either the April 2013 briefing was wrong. Or an average was used because performance was dire in 2012-13. Or the latest claim is wildly inaccurate. Or all of these claims are plucked by desperate people out of thin air.

But however it is looked at, nothing about this claim rings true.

And that's dire when we so urgently need to have confidence in HMRC restored.

But it does make my case for there being an Office for Tax Responsibility to check such claims and to make sure HMRC are held to account for them.