Friday, January 22, 2010

HMRC wins Best public policy decision of the year

At the first ever Citizens Advice Awards ceremony this week, HMRC were announced as winners of the "Best public policy decision of the year". This was felt to be HMRC's decision not to issue unexpected tax demands to thousands of low income pensioners following an administrative error in respect of the tax year 2007-08.

The Citizens Advice press release explains that:
"Through their engagement with a coalition of charities, including Citizens Advice, HMRC demonstrated that as well as being open to arguments of a legal and financial nature, they were also mindful of the plight of the pensioners concerned. In using their discretion not to pursue the unpaid tax they displayed the fairness and common sense for which this award commends them."
The only problem is that I'm not sure that HMRC deserve the award. As is well known HMRC do not have facility to exercise discretion and regularly tell us that they are legally obliged to collect all tax that is due even when the law operates unfairly.

As reported by the Telegraph in May 2008, the decision to waive the collection of tax in the case described in the citation was taken by the Government in response to extensive pressure brought by the charities and MPs. Perhaps HMRC officials were known to have passed on these representations to minsters. Perhaps.

What's your view on this award?

3 comments:

  1. Yes, they have to collect all tax that is due : but in this case there was no tax due as returns had not been issued. So why do we have to be snotty about it when HMRC does something right ?

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  2. Because 99 times out a hundred they do it wrong.

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  3. Because, judging by the last paragraph, it wasn't an HMRC decision to do the right thing. It sounds more like bowing to pressure from above. IF HMRC didn't really make the decision then they don't merit the award.

    Furthermore, if the tax was not due anyway then they are only doing their job and obeying the law in not pursuing it. An award for that is akin to rewarding an axe murderer for not killing people.

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