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Where Taxpayers and Advisers Meet
Legal Aid should stay for tax credits
16/03/2011, by Low Incomes Tax Reform Group, Tax Articles - General
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LITRG responds to the Ministry of Justice’s consultation on Legal Aid reform, warning that the rights of low-income tax credits claimants could suffer if they can no longer get help.
 

The consultation

The Ministry of Justice’s consultation document published in late 2010 on Legal Aid reform in England and Wales was a staggering 224 pages long. Yet within it, we only found one passing reference to tax credits, even though the proposals to remove welfare benefits (which include tax credits) from the scope of Legal Aid will have serious and damaging effects on access to justice for people on low incomes.

The impact of the proposals

These proposals come at a particularly difficult time, due to:

  • Funding cuts reducing the availability of benefits advice, upon which more pressure will be heaped as a result of planned changes over the next three years.
  • Significant reductions in face-to-face and hard copy publication support from government.
  • The drive to reduce error and fraud in the benefits and credits systems which may result in unprecedented levels of prosecutions, disputes and appeals.
  • Tax credit disputes are notoriously complex, as evidenced by the backlog of cases within HMRC.

We fear that lone parents and those with disabilities will be particularly affected by the removal of Legal Aid especially when coupled with other changes. The consequence may well be increased poverty and deprivation amongst these groups. We have therefore strongly recommended that welfare benefits remain within the scope of Legal Aid.

If MPs want to be self-interested, they need only think of the number of tax credit complaints they currently receive and multiply that significantly when Legal Aid is removed.

Useful links

Read LITRG’s full response to the consultation on their website 

About The Author

The Low Incomes Tax Reform Group (LITRG) is an initiative of the Chartered Institute of Taxation to give a voice to those who cannot afford to pay for tax advice. LITRG comprises tax specialists from professional practice and the voluntary sector, from publishing and from HM Revenue & Customs, together with people from a welfare benefits and social policy background. Visit www.litrg.org.uk for further information.
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