tiintax

Let us all wave to the House of Commons *waves* and then again to the House of Lords *waves*, our law makers.  Let us ask them to look again at a couple of the bits of paper that have been put in front of them and which have gone through on the nod.

Let’s start here, with a parliamentary question asked by David Morris, the Conservative MP for Morecambe and Lunesdale, on 22nd January.  Now I know nothing about Mr Morris beyond his website (the government has a Hairdressing Council?  Seriously?) and his wikipedia entry (and I can’t say I’m that sanguine about the veracity of all of that!) but Parliament.uk, usually a reliable source, gives small business as one of his interests.

So good for him, asking about the VATMOSS assessment of the impact on small business.

David Gauke’s reply was to refer him to the TIIN, published (on page A111 of the package of TIINs published on 10 December 2013 to accompany the draft clauses of the 2014 Finance Bill)

Let’s pause for a minute while you open up another screen, click on the link, and find page A111.  You might want to print it out, because we’ll be referring to it a fair bit over the next couple of entries.

Now to start with, what are we looking at here?  What is a TIIN?  Well I happen to know, because I was in the team that kind of accidentally invented the TIIN, when I was in charge of the Impact Assessment programme for tax measures.  An impact assessment is a formal document assessing the costs and benefits of making a regulatory change, and don’t get me started there (that’s what my PhD is about, amongst other things) and has to be done according to fairly strict protocols.  If you’re interested, there’s a hundred and eight pages of guidance you can access from this link (It was only 95 pages in my day).

At the point the coalition government came into office, there was a proposal to change the impact assessment template to make the format much tighter – to compel you to put an actual number to the costs/benefits and to put the numbers into the same format, essentially so that BIS could track the numbers across the whole government.  But that kind of impact assessment isn’t particularly helpful for tax changes, because the amount of tax raised or foregone is normally much greater than the administrative burden of the change itself.  So there was a lot of internal civil service politics around whether tax changes should be in or out of the new system, and this coincided with the move to improve the process of tax policy making itself, and the outcome was the invention of a tailored tax impact assessment process… but at the last moment the Treasury decided they wanted to combine the tax impact assessment with the Budget Note which HMRC used to produce explaining tax changes, and so we wound up with the Tax Information and Impact Note, the TIIN.

The TIIN, then, should explain what is being done and why, and include an assessment of the costs and benefits – to the exchequer, to the “customer”, and to HMRC.  It should also give the outcome of any other impacts which have been assessed, including equalities and other impacts to which governments have committed themselves (see the list on page 34 here and on page 66 here)

So.  David Gauke is telling us – is telling Parliament, in fact – that this TIIN contains the government’s assessment of the impact of the VATMOSS changes.

Let’s see what it says then, shall we?

First of all, look at the bottom of the first page, “background to the measure”.  This says:

Background to the measure

The measure was announced at 2013 Budget. Business input has been provided through joint business/HM Revenue & Customs (HMRC) groups.

Now, if you have been following the #VATMOSS #VATMESS hashtags or the articles in Taxation about POSMOSS you will know that one of the principal complaints of the micro and nano-businesses whose kitchen table businesses are likely to be wiped out by the change is that they were completely overlooked in the consultation process.  So who was representing small businesses on these “joint business/HM Revenue & Customs (HMRC) groups”?

I honestly don’t think that’s an unreasonable question to ask.

So I asked it.  On November 25th last year I sent a friendly email to the person who is named as the contact on HMRC documents, saying that it might well just be my google-fu was lacking but I couldn’t find the minutes of these meetings online as I’d expect so could he please point me to them?  I thought it was more than likely that the links was buried somewhere on gov.uk but just in case it wasn’t, I said if they weren’t yet published, would he please consider this a Freedom of Information Act request?

I had no reply.  But then I’d guessed at his email address (HMRC email addresses are usually in the format firstname dot lastname @hmrc.gsi.gov.uk but they can vary, after all) so on 11 December I put the request in formally via the HMRC Freedom of Information Act “portal” and had an acknowledgement telling me that

A response is being prepared and the statutory deadline is 13 January 2015.

On 21 January I sent another polite reminder asking why I hadn’t had a reply yet.  And on 30th January I received a reply.

Apparently

The external membership consisted of: Publishing: 3 small businesses Online Gaming: 2 small businesses Digital Services: 4 small businesses Other sectors/organisations: 3 representatives

but

I do not consider that there is a particular public interest in releasing the names of the micro or small businesses/organisations involved.

Now just a minute…

There used to be a handy page on the HMRC website that listed all the consultative groups, with links to their minutes and memberships.  It’s not there on gov.uk (well if it is, I haven’t found it yet!) but some individual groups are.  Look, here’s the Joint Customs Consultative Committee, the Research and Development Consultative Committee, the Joint VAT Consultative Committee (which, oh look, discussed MOSS on 8th May 2014…)

Are we seriously arguing that it’s a secret who the government talked to about introducing VAT MOSS?

No-none is planning on descending on the consulted businesses with pitchforks and torches – no responsibility resides with someone being consulted in answering for themselves and their own knowledge.  But there is a HUGE responsibility on HMRC and other government departments to ask the right people – to seek out and talk to the affected businesses.

Yes, I’ll be following up the FoI request – watch this space – but the arrogance (or defensiveness?) of saying there’s no public interest in knowing who HMRC consulted with, when the whole point of the outcry is that there are large numbers of people saying “I’m affected!  Who was representing me?”…. well, I think it’s just staggering.