“New £2.6bn tax dodging crackdown can’t work if existing tools are barely being used”: TaxWatch Budget analysis
The Budget’s third-largest tax pledge relies on a UK tax authority that is suffering from recruitment delays and unfinished IT systems. Just 26 of 6,700 extra compliance/debt staff promised by Chancellor are so far in post. A key tax to counter digital giants’ profit-shifting will remain despite Trump pressure, but the Budget has missed opportunities to tackle abused corporate reliefs now as large as the child benefit budget.
Staffing delays could threaten Chancellor’s £15 billion tax revenue plans
Though it’s been absent from the pre-Budget debate, the Chancellor’s second-biggest revenue-raising policy so far is a plan to boost HMRC’s personnel & systems: recruiting 6,700 more staff to chase an extra £15.5 billion of evaded tax and tax debts. Yet TaxWatch has found that just 26 of these promised new staff are yet in post, calling into question a key plank of the government’s tax and spend plans.
In the run-up to a make-or-break Budget, TaxWatch’s new State of Tax Administration report takes a deep dive into how HMRC has been running the tax system over the last year.
Rayner tax error: government must stop dragging its feet on regulating tax advice
Successive governments have rejected calls for a tax advice regulator and minimum professional standards, which exist in many other countries from Australia to Germany. It’s high time that UK taxpayers got similar protections.
Big fish, little fish…
With limited resources, how should the UK prioritise different types and targets of tax enforcement?
New weapons, same problems?
Stronger powers against ‘enablers’ – those who design and enable aggressive tax avoidance and evasion – are back on the table once again. But new figures show that existing powers are still not being used.
Broken offshore promises undermine the UK’s tax system
New figures on UK tax enforcement show that Pandora Papers leaks can’t supplant properly available information about who really owns offshore companies.
The gap in the Tax Gap
Quietly buried in HMRC spreadsheets released today is the news that the UK Tax Gap is consistently much bigger than HMRC previously said. New evidence suggests that the government may be under-estimating by several billion pounds the amount of income hidden offshore, and non-compliance amongst the largest and wealthiest taxpayers.
Starving HMRC will make it harder for Rachel Reeves to meet spending targets: TaxWatch responds to the CSR
Shrinking the £40 billion tax gap and £38 billion of outstanding tax debts is going to be critical for making today’s Spending Review numbers add up. Can HMRC deliver this with a real-term budget cut?
“With hindsight, the wrong way to do it”
Why aren’t enablers of tax abuse being penalised? HMRC’s powers to sanction delinquent tax advisers have roadblocks built in, and there are still gaps in naming and shaming.