HMRC To Consult Further On New Powers

by Leroy Baker, Tax-News.com, New York

11 January 2008

HM Revenue and Customs has published a summary of responses to last year's consultation on taxpayers safeguards, and in response has announced that it will begin the process of working with interested parties on the development of a Taxpayers' Charter, which will set out both taxpayer rights and responsibilities in a single accessible document.

In addition, three further consultation documents were published on Thursday as part of HMRC's work to modernise its powers, deterrents and the accompanying safeguards. HMRC currently relies on the statutory provisions inherited from its predecessor departments, which oblige it to follow different procedures for different taxes, resulting in various anomalies. This work is designed to provide greater consistency across all taxes through an approach that is aimed at recognising underlying taxpayer behaviour.

The first document on payment, repayment and debt proposes changes to the statutory framework that allows HMRC to collect tax debts and ensure that taxpayers pay what they owe; the second document contains proposals on compliance checks and puts forward proposals for a new framework for HMRC to check that taxpayers are paying the right amount of tax and claiming the right amount of repayments; and finally, the civil penalties document puts forward proposals for extending the new statutory framework in Finance Act 2007 for charging civil penalties to all other taxes, levies and duties that HMRC is responsible for, except for Tax Credits.

Commenting on the publication of the responses, Financial Secretary to the Treasury, Jane Kennedy, stated that:

"The Government is committed to ensuring that the tax system is useable and accessible and a Taxpayers' Charter will provide a good reference point for taxpayers."

"The further powers consultations are also another step towards a modern framework of law and practice for both HMRC powers and taxpayers safeguards, which will ultimately provide greater consistency across taxes and make HMRC more efficient and effective."

"I look forward to businesses, the professions and their representatives continuing to work with HMRC on these proposals."

Dave Hartnett, HMRC Acting Chairman, added:

"Making sure that taxpayers' rights are properly protected, whilst providing HMRC with the powers needed to ensure that today's tax system is properly administered, are key HMRC commitments. This is what the Review of Powers consultation, together with the Taxpayers' Charter, are about and I urge all interested parties to help us get that balance right by participating fully in the consultation."

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