Research consultancy firm ComRes found that just 16% of Britons believe HM Revenue & Customs should be allowed to use Accelerated Payment Notices (APNs) to demand tax it believes is owed without reviewing self-assessment forms or seeking a court judgment.
The survey also found that opposition to APNs was highest amongst over 65s, with more than 70% disagreeing with the Revenue’s new power.
HMRC began issuing APNs in August last year after receiving Royal Assent in July, and will continue to do so monthly until it has sent out over 43,000 notices, with 33,000 going to individuals and 10,000 to businesses. The notices were extended to national insurance contributions last month.
Over 2000 UK adults were interviewed online for the survey, which was commissioned by the Alliance for HMRC Accountability, a group of tax professionals who oppose HMRC’s approach to tax avoidance.
Member Ian Beech said: “HMRC should not be acting as a law unto itself. It is disconcerting and dangerous that it should be able to make financial demands of the public without having to prove its case.
“There is a clear sense that the public wants to see HMRC seeing judicial decisions and considering self-assessments, not making decisions autonomously.
He added that the group is concerned that APNs will make the tax system less rather than more transparent.
However, an HMRC spokesperson responded: “Most people pay their tax upfront – PAYE (Pay As You Earn), VAT (Value Added Tax), interest on bank accounts, some even pay on account, it is a case of pay now, dispute later.
“The accelerated payment rules enacted by Parliament have removed the cash flow advantage from the tax avoider of holding onto disputed tax during an avoidance dispute and puts all taxpayers on a level playing field.
“It in no way alters the rights people already have to dispute the tax they owe. This is only about where the money sits whilst the dispute continues. ”
Pressure
Frank Strachan, partner, tax at law firm Edwin Coe, said the Revenue was unlikely to alter its approach to tax avoidance as a result of public disapproval because of the pressure it “constantly” receives from the National Audit Office and the UK parliament’s Public Accounts Committee.
“HMRC’s position is that they are tough on tax avoidance, and as they have the power to issue APNs I can’t foresee any reduction in the numbers issued, nor the harsh stance they take on taxpayers who can’t fund the liabilities arising.”
Similarly, Martin Taylor, head of client services at Rebus, a company which provides help to people who have been mis-sold complex investments, said HMRC is unlikely to change its approach.
“According to David Gauke, the stated motive behind the Revenue’s powers is to ‘remove the cash advantage’ in order ‘to help us afford the public services on which the country depends’,” he said. “Despite this, recognising that a policy intended to benefit the public purse is largely unwelcome by the population it serves is unlikely to change HMRC’s perception on their approach to tackling the historic avoidance market.
“As explained by Danny Alexander, HMRC ‘are using psychologists and behavioural economists in HMRC to get the money quickly’. Their aggressive approach is carefully considered and is, according to their own announcements, largely working.”
