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John Andrews of the Low Incomes Tax Reform Group comments on HMRC's proposed Charter for Taxpayers.

Introduction

HMRC have published their suggested Charter. It tries to express in 227 words the relationship that HMRC expect to have with those who have to deal with them.

It is only a consultation still; but it shows the way that HMRC are thinking. We have some concerns about this thought process.

The HMRC Charter consultation continues with a document which includes the following suggested draft Charter:

HM Revenue & Customs makes sure that money is available to fund the UK’s public services. We also help families and individuals with targeted financial support.

We aim to make the tax and benefits system feel simple to use.

You can expect HMRC to:

• Treat you as honest, believing you are willing to pay what you owe, claiming only what you are entitled to, unless we have good reason to doubt you.
• Respect you, listening to your needs and taking into account your circumstances.
• Provide you with accurate information, making it easy for those who try to get things right.
• Recognise your right to be represented by someone else.
• Pursue relentlessly those that break or bend the rules.
• Protect the information that we hold about you.

HMRC expects you to:

• Work with us to ensure your payments or claims are accurate and made at the right time.
• Respect our staff, treating them in the same way as you want them to treat you.
• Contact us when you need help, advice or support, letting us know if you have particular needs.
• Tell us about changes in your circumstances so that we can get things right as early as possible.

Accessing information about HMRC:

• Service standards, such as our times for responding when you contact us.
• Data protection policy and keeping your information safe and secure.
• Complaints process.
• Appeals process.

We are all for brevity, but perhaps this goes too far. We expect that other documents will be published expanding upon the content above. However it is always dangerous to “agree” a top-level document without sight of the detail below.

For those people who are represented by professional tax advisers the Charter is important too, but the adviser can often ensure that HMRC do what they are supposed to do under the rules and take away the aggravation of interacting with the taxing authorities.

However for those who are not able to afford representation, the document is even more important.

Early thoughts

We have already said in a previous article: HMRC's New Vision: A Better Deal for Those on Low Incomes? that we would quarrel with a description of HMRC’s role as “making sure that money is available to fund the UK’s public services”. We believe that their job is to provide a high quality administrative service to assess and collect what people are due to pay under the law and pay out peoples’ entitlements to tax credits etc.

It is not as if HMRC are the only body in the UK who assess and collect taxes. Others, such as local authorities, not only collect taxes but administer a number of the public services to which HMRC refer.

We also note that HMRC aim to make the “benefits system” feel simple – we wonder if they have told the Department for Work & Pensions that they are going to do that.

Most of the things that HMRC say we can expect them to do would apply to any civil servant, or indeed anyone who hoped to succeed in a service industry.

However there is one phrase which would generally not apply elsewhere. Apparently, we expect HMRC to “Pursue relentlessly those that break or bend the rules”?

The sight of HMRC relentlessly pursuing 90% of the British public is an unedifying spectacle.

Breaking or bending?

The major point about HMRC rules is that there are an awful lot of them. The Government add hundreds of pages of new ones every year.

No single person employed by HMRC could answer questions on all the rules that a low income unrepresented individual is expected to know. It is impossible even for specialists within LITRG to know them all; we just know where to find them.

But most of the great British public do not know the rules, and reasons for that are:

• The rules are too complex in the first place
• HMRC do not ensure that the explanations of the rules are expressed in language that most people can easily understand
• Nor do they ensure that all who need to know the rules have access to them.

This is why we would estimate that 90% of the British public will at some time "break" these rules – albeit unknowingly. Most people will not be clever enough to know how to bend them.

Indeed, most people would not be able to explain the difference between breaking a tax or tax credits rule, and bending it.

People would support the idea of HMRC pursuing clear fraudsters; anything else would make everyone else look over their shoulders and worry endlessly. This sentence needs changing without a doubt.

Conclusion

In HMRC's New Charter: The Low-Income Perspective we have commented on things we immediately don’t like, but we need to see what more detail HMRC propose to publish before we can decide what is missing from the Charter as a whole. We will be returning to this subject when we find out more of HMRCs’ intentions.

Our views which we expressed in Round One of consultations have not been fully recognised and that much is clear.

We hope, after one of the most thorough and extensive (and expensive?) consultations ever undertaken by HMRC, that we are not left with a whimper.