With just over three weeks until the Budget, the government’s plan to recruit 5,000 new HMRC compliance officers has been welcomed by leading audit, tax and business consultancy firm Blick Rothenberg.
However, the company warns that these recruitment efforts are only a small step towards solving the deep-seated problems in the UK tax system.
Robert Salter, director at Blick Rothenberg, noted that HMRC has been under-resourced for years, and while the addition of new staff is a positive development, it will not be enough to address the wider structural problems plaguing the tax system. “HMRC systems are often poor and do not provide a good service to either HMRC or taxpayers,” Salter said. He cited HMRC’s tool for determining employment status for tax purposes as an example of a system that often produces incorrect results when tested against binding UK case law.
Salter stressed the importance of extensive training for the new recruits, emphasizing that the complexity of the UK tax system requires a thorough understanding of the many complicated and sometimes counter-intuitive regulations. “Without in-depth long-term training, the money spent on recruitment could be wasted and taxpayers could experience poorer service delivery as a result of undertrained officials who misinterpret tax laws or ask for the wrong information,” he warned.
As the Budget approaches, Salter hopes Chancellor Rachel Reeves will provide details of how the new HMRC officers will be trained to effectively tackle the complexities of the tax system. He stressed that while the recruitment drive is a positive first step, it must be accompanied by significant improvements to HMRC’s systems and procedures to make a real difference to taxpayers.
Blick Rothenberg’s concerns come at a crucial time, with taxpayers and tax advisors eagerly awaiting the potential tax changes expected in the upcoming budget. The firm’s experts argue that without a clear plan for comprehensive training and system upgrades, the government’s efforts to improve HMRC’s capabilities may not have the intended impact.