Fresh call for HMRC investmentsby
A fresh call for investment into HMRC has been made in a bid to “address poor service standards” and “remove a barrier to growth and productivity”.
The Institute of Chartered Accountants in England and Wales (ICAEW) has made a call for new investment in a bid to streamline HMRC registrations, simplify the tax system and boost R&D spending.
A series of recommendations have been made to all political parties by the chartered accountancy body ahead of the upcoming general election.
The manifesto has been produced on the back of an engagement process with ICAEW Chartered Accountants “across every sector, region and business size” in the UK, with the outcome being a 16-point plan.
It comes amid an existing push for further investment in HMRC.
ICAEW’s manifesto sets out recommendations in several areas including skills, sustainability, innovation, resilience, trust and trade.
So far as HMRC goes, it has called for:
- the introduction of business start-up passports to streamline registrations
- a new strategy to simplify and digitalise the tax system and a commitment to increase R&D spending beyond 3% of GDP
- the next government to explore a new version of the growth voucher scheme, which closed for new applications in 2015
The proposed investments are part of a drive to “address poor service standards, remove a barrier to growth and productivity, and provide equitable redress to taxpayers that have incurred extra costs due to delays”.
The launch of the manifesto is against the backdrop of calls for further investment into HMRC, with the authority’s service performance having been discussed at a meeting between the Chancellor of the Exchequer and ICAEW on 16 January 2024.
In a letter to financial secretary to the treasury Nigel Huddleston MP, ICAEW head of tax strategy Frank Haskew set out a summary of recommendations to improve matters.
Among these were:
- establishing an HMRC taskforce to both clear the backlog of correspondence and keep on top of it
- a greater consideration of the impact of any tax policy changes on HMRC’s effectiveness
- a step change in HMRC’s approach to driving improvements along with greater accountability, among other suggestions
In the same letter, Haskew revealed that the ICAEW continues to receive evidence of “unacceptable HMRC service performance on a daily basis”.
“The problems are across all HMRC service areas and include extreme waiting times on helplines, calls being cut off and long delays in responding to post,” he said.
“Members are increasingly commenting that the quality of service that they receive when they do speak to an adviser or receive a written reply has deteriorated significantly with HMRC advisers unable to deal with the issue and giving incorrect information.”
Haskew highlighted that the situation is “currently most acute in the area of income tax self assessment (SA) and individuals’ pay as you earn (PAYE)".
He did note that this is partially seasonal, but added that the situation has been “exacerbated by HMRC’s decision to restrict the SA helpline and the agent dedicated line (ADL) to a limited range of queries”.
On the back of the fresh call for investment, Iain Wright, ICAEW managing director, reputation and influence, said that while entrepreneurs are the “lifeblood of our economy, members have told him it “isn’t as easy as it once was”.
“This set of recommendations, grounded in the insight and experience of our members across the country, will help the next government and parliament take the actions necessary to make it easier to start, run and grow a business and boost the resilience and strength of the UK economy."