HMRC moving in right direction, says stakeholder report, while IFS scrutinises publishes discussion papers on HMRC's discretionary powers and the role of the OTS
HMRC released its Stakeholder engagement report 2014 last week. While the wording was largely positive in its findings, the report conceded that HMRC needed to do more to help people get their tax right. ‘While stakeholders are generally positive about HMRC’s ability to fulfil its core function – the collection of tax revenue – some question if HMRC should do more to help the honest majority get their tax right, and whether HMRC treats all taxpayers even-handedly,’ the report stated. ‘Despite this, there is a clear sense that HMRC is moving in the right direction. In the qualitative research, stakeholders regularly praise HMRC’s senior leadership team and feel that it is increasingly willing to listen to, and engage with, stakeholders, but cite customer service, the digitisation of services and a lack of dynamism as key weaknesses.’
Kingston Smith tax partner, Tim Stovold, commented: ‘In recent years, HMRC has automated its telephone helplines and will often refer people who know little about tax to fairly complex guidance on their website. It is interesting that this has been picked up in this report and we will watch to see if HMRC take any steps to address this concern.’
Meanwhile the Tax Law Review Committee of the Institute for Fiscal Studies (IFS) published two discussion papers inviting comment. The first paper, HMRC’s discretion: the application of the ultra vires rule and the legitimate expectation doctrine, considers the development of HMRC’s discretionary powers and the limits applied by the courts on the use of those powers with particular reference to the legitimate expectation rule; and aims to promote discussion about the extent of HMRC’s discretion in interpreting and applying the tax rules set out by Parliament and whether taxpayers’ abilities to challenge the use of that discretion are sufficient, as well as identifying problems with the application of HMRC’s discretionary powers and the ability of taxpayers to rely on the various forms of statements and guidance which HMRC are increasingly under pressure to provide, as well as considering the procedures for claiming reliance on statements.
The second paper, The Office of Tax Simplification: Looking back and looking forward, considers what the OTS has achieved to date and what can be learnt about the impact of the OTS on simplification of the tax system, as well as what conclusions can be drawn from the past four years in assessing whether the next government should continue with the OTS and what changes to its operation could be considered. The report finds that the OTS’s achievements to date ‘are welcome but there is much left to do’. There is ‘insufficient appetite’ in government for more radical changes to simplify the system: ‘too often, too little of what is proposed by the OTS is taken forward’. The lack of response by government to many of the substantive changes recommended by the OTS ‘has left an impression that the OTS is focused on administrative changes’. There is ‘evident pressure’ from the government to produce ‘“quick wins” to fall in with the Autumn Statement and Budget timetables’; this ‘should be resisted’. The report states that: ‘Further thought should be given to the status and independence of the OTS’ and the OTS’s inability to consider new law ‘undermines [its] credibility.’ The report also notes that the OTS has ‘minimal’ resources and ‘a significant increase in resources is needed to enable it to promote more significant simplification.’
HMRC moving in right direction, says stakeholder report, while IFS scrutinises publishes discussion papers on HMRC's discretionary powers and the role of the OTS
HMRC released its Stakeholder engagement report 2014 last week. While the wording was largely positive in its findings, the report conceded that HMRC needed to do more to help people get their tax right. ‘While stakeholders are generally positive about HMRC’s ability to fulfil its core function – the collection of tax revenue – some question if HMRC should do more to help the honest majority get their tax right, and whether HMRC treats all taxpayers even-handedly,’ the report stated. ‘Despite this, there is a clear sense that HMRC is moving in the right direction. In the qualitative research, stakeholders regularly praise HMRC’s senior leadership team and feel that it is increasingly willing to listen to, and engage with, stakeholders, but cite customer service, the digitisation of services and a lack of dynamism as key weaknesses.’
Kingston Smith tax partner, Tim Stovold, commented: ‘In recent years, HMRC has automated its telephone helplines and will often refer people who know little about tax to fairly complex guidance on their website. It is interesting that this has been picked up in this report and we will watch to see if HMRC take any steps to address this concern.’
Meanwhile the Tax Law Review Committee of the Institute for Fiscal Studies (IFS) published two discussion papers inviting comment. The first paper, HMRC’s discretion: the application of the ultra vires rule and the legitimate expectation doctrine, considers the development of HMRC’s discretionary powers and the limits applied by the courts on the use of those powers with particular reference to the legitimate expectation rule; and aims to promote discussion about the extent of HMRC’s discretion in interpreting and applying the tax rules set out by Parliament and whether taxpayers’ abilities to challenge the use of that discretion are sufficient, as well as identifying problems with the application of HMRC’s discretionary powers and the ability of taxpayers to rely on the various forms of statements and guidance which HMRC are increasingly under pressure to provide, as well as considering the procedures for claiming reliance on statements.
The second paper, The Office of Tax Simplification: Looking back and looking forward, considers what the OTS has achieved to date and what can be learnt about the impact of the OTS on simplification of the tax system, as well as what conclusions can be drawn from the past four years in assessing whether the next government should continue with the OTS and what changes to its operation could be considered. The report finds that the OTS’s achievements to date ‘are welcome but there is much left to do’. There is ‘insufficient appetite’ in government for more radical changes to simplify the system: ‘too often, too little of what is proposed by the OTS is taken forward’. The lack of response by government to many of the substantive changes recommended by the OTS ‘has left an impression that the OTS is focused on administrative changes’. There is ‘evident pressure’ from the government to produce ‘“quick wins” to fall in with the Autumn Statement and Budget timetables’; this ‘should be resisted’. The report states that: ‘Further thought should be given to the status and independence of the OTS’ and the OTS’s inability to consider new law ‘undermines [its] credibility.’ The report also notes that the OTS has ‘minimal’ resources and ‘a significant increase in resources is needed to enable it to promote more significant simplification.’
