On 13 January, the Public Accounts Committee heard evidence on HMRC’s approach to tackling tax fraud, in the light of HMRC estimates that losses to tax fraud amount to £16bn annually. Witnesses included: Dame Lin Homer, HMRC chief executive and permanent secretary; Jennie Granger, HMRC director general of enforcement and compliance; and Simon York, HMRC’s director of its fraud investigation service.
One of the topics covered in the session was that of VAT fraud, particularly by online retailers. Homer said that in the light of the UK’s increasingly online shopping habits, a particular problem was overseas suppliers using platforms eBay and Amazon effectively to evade VAT, with lost revenue of £10bn estimated. ‘The question of whether the purchaser knows or even thinks about where they are buying from, and whether they ask or understand the right questions about import duties – both VAT and excise duties – is a very big issue,’ Homer said. ‘We are absolutely sure it is a growing risk in the system, just as carousel [MTIC] fraud was four or five years ago.’
Among the other topics covered were: HMRC’s plans to increase the number of prosecutions (or investigations that potentially lead to prosecutions) to 100 for ‘wealthy and complex’ individuals and corporates from the current figure of around 35; the office closure programme; and the number of telephone calls that went unanswered. In response to Homer’s assertion that HMRC answered 81% of calls within six minutes, Stephen Phillips MP pointed out that a Which? survey undertaken in September 2015 showing that HMRC’s telephone service had got worse, and cited the lack of consistency as an issue HMRC needed to deal with.
Meanwhile, according to ICAEW members, the quality of HMRC services has suffered further deterioration. More than 90% of those polled thought HMRC’s service standards had either remained the same (48%) or had deteriorated (43%). The number that thought services had deteriorated increased from 34% in 2014, despite HMRC recruiting a further 3,000 call centre staff. The survey also reported that delays are inevitably impacting on time and costs, with 57% saying the amount of time spent dealing with HMRC has increased, up from 47% last year; and 40% thought that the monetary cost has increased in the past year. The most pressing areas for improvement cited were improvements in call waiting times (37%) and better staff knowledge (35%).
On 13 January, the Public Accounts Committee heard evidence on HMRC’s approach to tackling tax fraud, in the light of HMRC estimates that losses to tax fraud amount to £16bn annually. Witnesses included: Dame Lin Homer, HMRC chief executive and permanent secretary; Jennie Granger, HMRC director general of enforcement and compliance; and Simon York, HMRC’s director of its fraud investigation service.
One of the topics covered in the session was that of VAT fraud, particularly by online retailers. Homer said that in the light of the UK’s increasingly online shopping habits, a particular problem was overseas suppliers using platforms eBay and Amazon effectively to evade VAT, with lost revenue of £10bn estimated. ‘The question of whether the purchaser knows or even thinks about where they are buying from, and whether they ask or understand the right questions about import duties – both VAT and excise duties – is a very big issue,’ Homer said. ‘We are absolutely sure it is a growing risk in the system, just as carousel [MTIC] fraud was four or five years ago.’
Among the other topics covered were: HMRC’s plans to increase the number of prosecutions (or investigations that potentially lead to prosecutions) to 100 for ‘wealthy and complex’ individuals and corporates from the current figure of around 35; the office closure programme; and the number of telephone calls that went unanswered. In response to Homer’s assertion that HMRC answered 81% of calls within six minutes, Stephen Phillips MP pointed out that a Which? survey undertaken in September 2015 showing that HMRC’s telephone service had got worse, and cited the lack of consistency as an issue HMRC needed to deal with.
Meanwhile, according to ICAEW members, the quality of HMRC services has suffered further deterioration. More than 90% of those polled thought HMRC’s service standards had either remained the same (48%) or had deteriorated (43%). The number that thought services had deteriorated increased from 34% in 2014, despite HMRC recruiting a further 3,000 call centre staff. The survey also reported that delays are inevitably impacting on time and costs, with 57% saying the amount of time spent dealing with HMRC has increased, up from 47% last year; and 40% thought that the monetary cost has increased in the past year. The most pressing areas for improvement cited were improvements in call waiting times (37%) and better staff knowledge (35%).
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