Jolyon Maugham has posted the following on his blog (which I always recommend) this morning, and I cross post it with his permission:
Back in February Labour announced that it would, if it took power, begin an “immediate and independent review into the culture and practices of HMRC with regard to tax avoidance.”
This politicisation of the question whether HMRC retained public confidence diffused the logic of the demand. But the force of the argument sufficed to overcome this handicap. A broad church of respected industry figures coalesced around a single answer. Paul Aplin, Chair of the ICAEW Tax Faculty Technical Committee, Professor Judith Freedman at Oxford University, Ray McCann and Richard Murphy all joined in the call for a review.
The politics have come and gone. But the issue has not got away. Paul Aplin has repeated the call. Twice [£]. As has Bill Dodwell, Head of Tax Policy at Deloitte. And so, too, apparently, Grant Thornton. Let me, here, add my voice to theirs.
There is much that we agree on. We each of us identify the need for a review as stemming from a breakdown in public confidence in HMRC: of this, and the threat it poses to social cohesion, there can be no serious doubt.
We all, no doubt, understand the difficulties arising from a constrained funding environment. But even proceeding from this premise, there remains much that might be done to improve the relationship between HMRC and the public it serves.
Political accountability must be enhanced: whilst I have heard the arguments, I still do not understand the case for HMRC remaining a department without a minister.
Transparency goes arm in arm with accountability: the culture of HMRC must change so that it proceeds instead from the assumption that the public has a legitimate interest in understanding the basis on which decisions are made. Whilst plainly there will be hard cases, even under the law as it presently stands there is high level authority for the proposition that HMRC could move some way from the status quo.
Whilst there is disagreement amongst professionals as to whether the recent extensions to HMRC's powers are justified, there is an emergent consensus that those powers are subject to inadequate internal and external control and supervision. These failings are not only to be found at HMRC — but it is there that rebalancing the culture must begin.
As I and many others have observed, the proper functioning of our tax system is materially contingent upon the public's voluntary obeisance to it. That obeisance is under strain. Lose it and it won't be recovered in a dozen Finance Bills.
I agree, although I think Jolyon's suggested remit is too narrow and shows his legal background. I would include the need for a thorough review of the governance of HMRC in the brief. As I have said before, and will say again, it is absurd that HMRC's board is made up from the large business community and its advisers, who between them represent about 700 tax payers when there are 31 million income tax payers alone in the UK.
It is also absurd that parliament has almost no resources available to it to scrutinise HMRC. Margaret Hodge may have done well, but it was despite the National Audit Office and not because of them. Indeed, the NAO fought long and hard to deny information on HMRC to the PAC. That is wholly unacceptable and must change. It is why I suggest that there should be an Office for Tax Responsibility reporting straight to the PAC that can properly audit HMRC and tax policy.
Third, any review should look at the resourcing of HMRC.
And last, in any such review rather more than the interests of big business and the tax profession must be represented or this will look like a stitch up and that is the very last thing that is needed now.
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Hear, Hear
Despite the neoliberal ‘election victory’ on a mere quarter of the vote, mainly achieved by false prospectuses and through the considerable manipulation of the electorate by their craven lickspittles in the oligarch-run media, it is critical that their plans for neo-feudalism and the eventual destruction of everything that constitutes civil society be averted.
An Independent review of HMRC, with considerable input from a civil society that has basically seen its rightful place in governance taken away by what is not far short of a coup d’etat ought to be seen as a priority to ensure that the poor and vulnerable are not sacrificed on the altar of high finance.
“And last, in any such review rather more than the interests of big business and the tax profession must be represented or this will look like a stitch up and that is the very last thing that is needed now”.
This will be buried in the fullness of time – watch out for HMRC to up its propaganda about how well it is doing at cracking down on anti-avoidance. Then when the masses concentration on this issue loses focus the call for a proper review of HMRC will slip silently into the “business as usual” lake never to surface again during the life of this current Tory administration.
In all probablity we shall be stuck with ths Government for another term, because there will be no serious challenge from the Labour party, because at the moment it has an identity crisis.
The Labour party appears to have suffered a blow to the head and is wandering around like an amnesiac unable to recognise his relatives and friends.
It is in dire need of re-discovering it roots and original purpose quickly before the Tory Government achieves its objective of reintroducing the five “Great Evils”.
It does appear to be Beveridge in reverse, I agree
“The Labour party appears to have suffered a blow to the head and is wandering around like an amnesiac unable to recognise his relatives and friends.”
What a lovely turn of phrase and I so agree.
The problem seems to me that they remember way into the past and keep trying to find the working class. I’m working class because I work. But others tell me that’s not the system… So give up on class for a start! Then a bit of vision would be nice. Never mind the Ed stone what about ideas? That’s what might motivate people – not the Newspapers but people!
Crumbs, another blog of today I agree with 100%,you are on a roll!