Archive for April, 2014

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Taxpayer confidentiality 1: who is the taxpayer?

April 25, 2014

Taxpayer confidentiality  used to be a bedrock principle of HMRC.  I noticed it had acquired some quote marks and become “taxpayer confidentiality” in places in the consultation on flogging off our data to the credit reference agencies so I wonder how long it will be before it becomes “so-called taxpayer confidentiality” or some such?

Anyway, let’s think a bit today about taxpayer confidentiality without the quotes.  First of all, who is the taxpayer?

People pay tax.  Or, rather, “persons” pay tax: that can be “natural persons” i.e. human beings, individuals.  And it can also be “legal persons” like corporations.  Companies pay tax, but they aren’t people: they are legal constructs.  Do companies have the same rights as people?  Should they be able to sue for libel?  Should they be able to litigate against national governments (as in the hotly-disputed investor-state dispute settlement mechanism)?

Do they, in fact, have any rights to privacy?

Well, one of the trade-offs for limited liability protection for investors is that the accounts of companies have to be published.  Should their tax returns be published as well?

Why?  Or why not?

After all, much of the furore over Vodaphone, Starbucks, Google et al was public concern at publicly available information about entirely legal activity.  Would the furore over the enormous cost of breast cancer drug Kadcyla have been lessened if we could have looked at Roche’s accounts in more detail and seen how much they spend on the necessary research and development to produce a new drug?

Or would a little journalistic googling have revealed that the drug, which costs £90,000 for a course of treatment in the UK, costs  $94,000 in the US (around £56,000, I make it, if a dollar is worth around 59 pence).  Put that alongside the fact that the UK government has given away £320m this year in research and development tax credits (TIIN for Research and development tax credits reform: above the line: 2014-15 figures of $240 and £80 million totalled) and another £720 million this year in the special rate for profits from patents (TIIN for Corporation Tax Reform: Patent Box, 2014-15 figures)

If Roche were compelled to publish their tax returns and we could see whether they had had any of the billion pounds the UK government will use to incentivise research and development and patentable drugs this year, would we feel any differently about them?

Is a corporation a taxpayer with an expectation of taxpayer confidentiality?  See what I mean?  It’s not as simple as you might have thought.

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#flogitHMRC

April 24, 2014

I’m a bit cross, actually.  How did I miss this?  I opened my newspaper at my convention hotel on Friday morning and there were the headlines: “Borderline insane: Government plans to let HMRC sell taxpayers’ details to private companies”

I actually trawled back through my blog entries from last summer, thinking the consultation must have been snuck out by stealth somehow, but no, here it is in my table of upcoming consultations, except it’s called “sharing and publishing data for public benefit” which sounds both like boring policy-wonkery and also like something innocuous and cuddly – public benefit, after all.  So, yes, I missed it entirely (it closed around the time I was deep in academia, preparing and giving my first academic paper and letting bloggery slide)  So shoot me.

The thing that baffles me, however, is how it came to be a big news story on Good Friday and Easter Saturday.  What happened?  I have trawled through as many articles as google will give me, but all I can find that’s new is the quote from David Davis about the plan being “borderline insane” and he barely mentions it on his website.  Is it publicity for the play about him (Privacy, at the Donmar) perhaps?  He certainly seems to have been amusing himself in giving interviews to coincide with the production.

However I’ve read the consultation document, the supplementary document (yes, seventy thousand businesses have already had their data handed over to Credit Reference Agencies already, using the figleaf of appointing them as agents of HMRC for the purposes of a “trial”) and the responses doc.  So I’m ready, when the next round of consultation comes out.

At the same time, though, I’ve been thinking about taxpayer confidentiality and big data in other contexts – in doing some work with the Women’s Budget group and the Ekklesia think tank, as well as following the conversation at the Guardian Public Sector blog.  Rather than make one giant tl:dr post, I think I’ll come back to it over the next week or so and unpack my thinking a bit.  Watch this space!

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Happy Easter

April 18, 2014

Quiet, isn’t it?  I’m off for a few days at a convention in my other persona, in pursuit of science fiction.  After I am done living in the future I will catch up with the outstanding tax consultations in a week or two.  Play nicely while I’m gone!

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Women’s Budget Group reports

April 15, 2014

I had the unusual experience this year of watching the Budget at the LSE alongside a group of other feminist academics from around the country.  After we had watched the speech and discussed our first reactions, we split up the Budget according to our various specialisms and went off to do some rather fuller analysis than the insta-punditry that was going on in the papers.

You may have your own views on whether it’s better to hit the reporting cycle while the Budget itself is still news, or to think about it for a bit longer and come up with a reasoned response.  Personally I think you have to do both, but anyway, here’s the advert: the Women’s Budget Group analysis of this year’s Budget can be found here.

(Which bits, if any, were written by me, I leave as an exercise for the class!)

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Bounty

April 7, 2014

I was surprised to read in a new piece about Bounty (the organisation that distributes those “bounty” packs to new mothers) that HMRC are still paying them – a commercial company – £90,000 a year to distribute child benefit application forms.  Didn’t we deal with this?  The Telegraph investigated it last May and there was a petition against the practice of the company being allowed to visit maternity units at all but at the same time a call to email David Gauke asking him to end HMRC’s relationship with Bounty (scroll down to the comments).

I have no knowledge of whether the “Bounty” packs are a good thing or not (except that I never realised “bounty” was the name of a commercial company – I had heard the term “bounty pack” for years and had taken it for its literal meaning of  a bonus or gift – I thought they were the NHS’ gift to newborns!)  But I am pretty certain that giving a commercial firm legitimacy by allowing them to distribute child benefit forms is a bad thing.  Don’t get me wrong, they can add them to the packs if they like – but they’re a commercial company.  It should be up to them to decide whether or not they want to obtain supplies of the forms from HMRC and stick them in the packs.  HMRC shouldn’t be giving them ninety grand of our money for doing so.  Give the responsibility instead to registrars; there shouldn’t be any need for one arm of the government to pay another arm of the government for doing something desirable in the first place, should there?  Isn’t THAT what we mean by “joined up government”?  So when someone comes to register a birth they should automatically be handed a form to apply for child benefit.  In fact, if we’re in “tell us once” mode, why can’t a registered birth also be a registered claim for a universal benefit?

Just a thought!

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Slow but sure

April 2, 2014

Remember the complaint that was settled on 24th March with an offer of £25 compensation? The cheque arrived this morning, eight working days later.

Is that good, or is it a bit much? The cheque is actually dated 25/3 so it doesn’t look like delay by the complaint handler but merely another example of HMRC’s notoriously labyrinthine mail system.

So tell me. Is that a long time, or have we just got used to waiting a fortnight and feeling lucky if it’s less?

Posted in HMRC | 2 Comments »

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Demerger

April 1, 2014

Today, some interesting rumours reach me of proposals to de-merge HMRC and restore the historic brands of HM Inland Revenue and HM Customs and Excise.  I hear that the proposals, which are to go out to consultation in the next few months, will also include a clever exit from the once-controversial Mapeley contract and a move out of leased and into properties owned by the taxpayer, saving millions in rent and services payment and creating several thousand jobs in providing building and other services direct by newly-appointed staff who will also be available to perform “back office” functions at times of need.

The de-merger will also herald the de-industrialisation of tax, as both restored departments return to a local office structure.  The main change that taxpayers will see is that they will once more be able to speak to someone, face to face or over the phone, who actually knows what they are talking about, will give their name, extension number and email address, and will then take responsibility for working an issue through to its conclusion.

I hear that the de-merger will come with a hefty staffing and budget increase, to be paid for by the expected rise in collection and compliance yield and narrowing of the tax gap.  There is also likely to be a new task force bringing long-standing disputes to a conclusion via rapid litigation, following which the task force will direct its expertise into prosecution of all tax offences resulting from the new alignment of prosecution thresholds for tax, customs, excise and benefit cases.

Whether the coalition can bring this off in time before the election is, of course, in considerable doubt, but I hear that the timetable is

May 2014 consultation

July 2014 consultation ends.  Enabling legislation passed

September 2014 contracts signed for new local office accommodation

December 2014 first District Inspectors appointed and begin appointment of supporting staff

February 2015 New offices occupied and shadow operations begin while skeleton staff winds down the last of HMRC operations

1st April 2015: New IR and New C&E begin operations.

Posted in HMRC, Look at the date | Tagged , , | 2 Comments »