Inland Revenue Urged To Speed Up Recovery Of Tax Debt
by Robert Lee, Tax-News.com, London
26 November 2004

The UK’s Inland Revenue should take a more proactive stance to help speed up the recovery of tax debt, such as taking payments directly from people’s salaries or bank accounts, a House of Commons select committee report has argued.

In a recently released report, the Public Accounts Committee recommended that the Revenue utilise similar debt collection strategies to private utility firms, by using records held by other governmental departments to trace non-payers and seeking greater powers of recovery.

The report also suggested that the UK tax collector follow the example of tax authorities in other countries by employing private debt collection agencies to recover tax debts, and by allowing tax payments to be made by credit card.

"The longer the debt remains outstanding the more difficult it is to collect, so it is important to get people to pay as quickly as possible," the report concluded.

Edward Leigh, Chairman of the committee, added that:

"It is vital that the Inland Revenue steps up its efforts to speed up debt recovery, through using other departments' records to trace those who owe tax, pursuing all debts owed by the same person at the same time, and seeking greater powers of recovery."

Reports suggest that some £700 million worth of outstanding tax is written off every year, although the number of enforcement actions initiated by the Revenue has increased from 155,000 in 2001/2002 to 181,000 in 2002/2003.

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