Critics Shoot Down Primarolo's Spin On The Tax Credit Affair

by Robert Lee, Tax-News.com, London

06 November 2003

The attempt by the UK’s Paymaster General, Dawn Primarolo, to label the recent introduction of the new child tax credits “a massive success” has provoked a severe rebuke from many quarters, the Daily Telegraph reported on Wednesday.

According to a statement released by the Paymaster General last Friday, Primarolo said the new tax credits were a “remarkable achievement” and claimed the new system had achieved a 98% success rate.

However, Inland Revenue statistics quoted in the Telegraph paint an altogether different picture: Between March and August this year, some 17 million callers to the tax credit helpline were put on hold, with a further 17 million unable to get through at all as the call centre queues were full. Furthermore almost 3 million calls were terminated by the caller in this time and only 7 million from a total of 80 million telephone enquiries were answered within twenty seconds.

"For Dawn Primarolo to claim that tax credits have been a remarkable achievement shows a complete disregard for the misery caused to thousands of claimants," said Angela Brooks Wong, a director at lobby group Tax Relief, according to the Telegraph, echoing the sentiments of many in the tax industry who firmly reject the Paymaster General’s claims.

Meanwhile, accounting firm Ernst & Young point out that for the new tax credit system to have achieved a 98% take in the first six months of operation would mean the Treasury will exceed its own forecast by the end of the first year. “This will mean the chancellor will have to find more money to meet the payments," observed Anne Redston, a tax partner at E&Y.

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