40p a minute: where is all the money going?
As reported last week HMRC boss Mike Clasper has been given the boot because he’s failed to get results. It was around this time last year he went on the Beeb admitting and apologising for the mess and promising to sort it out, you can see the clip here. One of the specific things he promised was to get HMRC to answer the phones more promptly. 11 months on things don’t seem to have got better.
The Low Income’s Reform Group carried out their own ‘mystery shopper’ tests and found a waiting time of 29 minutes was average, they say:
- People are obliged to telephone HMRC to report important events. If they do not, then they can suffer quite severe penalties.
- The cost to the individual on a Pay As You Go (PAYG) mobile telephone can be as much as 40p a minute to most HMRC lines on an 0845 number.
- The reputational risk to HMRC is very high if they cannot be seen to do even the simplest customer service things well.
Just over a year ago our hopes were raised when the current Chairman of HMRC said to the Treasury Sub-Committee that he expected to see a “period of steady improvement” in HMRC’s performance in answering the telephone. No doubt HMRC can produce statistics to show that people are getting through more often than they did, or are being cut off less often. But this does not take into account the length of time people have to wait to get a response – an average of just under 30 minutes.
For me and you losing £10k in a day would be a disaster, but for HMRC it’s just another day at the office. The latest blunder comes after HMRC sent out 2,000 penalty notices to people who have been taken out of the Self Assessment process.
Calculators out! It’s £9960 wasted – franked mail was 39p so £4680 for the blunder and an additional £5280 for the apology letters. Then of course there is the labour, envelopes, paper and ink.
A HMRC spokesman said: “We have identified that nearly 12,000 people have been sent a Self Assessment daily penalty letter in error. We are very sorry and can reassure these customers that we know who they are and that this letter is incorrect – they do not owe a penalty. We are writing to all of them to apologise and to explain this error.
Full story on AccountingWeb.
Mike Clasper: failed to bring the bacon home
Mike Clasper was recruited in to get HMRC’s house in order, but he has failed.
The bottom line is this: our government is broke and it needs to get more revenue, yes there have been a string of embarrassing events, but Mike could ride the storm if he was bringing home the bacon, but he’s not. And why is that? Well the ‘sweetheart’ deals large companies have been getting could be something to do with it. Then there’s the all those super rich who are paying less tax than their cleaners – again worth looking into Mike.
I know that headhunters are out there now looking for a replacement and I’d like to put myself forward, I know the bosses at HMRC read this, so please send the application details to me using the contact page.
Full story in the Telegraph here.
Osborne: shocked
George Gideon Oliver Osborne, Chancellor of the Exchequer heir to the baronetcy of Ballentaylor, member of the Bullingdon Club, chum to David Cameron and Nat Rothschild, Member of Parliament for Tatton, with an estimated personal fortune of £4 million (from a trust fund paid for by his father) has said, “I was shocked to see that some of the very wealthiest people in the country have organised their tax affairs… so that they were regularly paying virtually no income tax. I’m talking about people right at the top. I’m talking about people with incomes of many millions of pounds a year. The general principle is that people should pay income tax and that includes people with the highest incomes.”
The “surprise” comes after George Osborne saw a confidential study by HMRC which found that the wealthiest people are using legal avoidance tactics to reduce their income tax rate to an average of 10% – less than half the level paid by the average Briton.
Can he really be surprised? The Guardian thinks not and quotes Mr Osborne from his budget speach last month, “ under the last Government, it was the boast of some high earners that, with the help of their accountants, they were paying less in tax than their cleaners. I regard tax evasion and – indeed – aggressive tax avoidance – as morally repugnant.”
The bottom line is this: and it’s what tax-hell.co.uk is all about, there are very rich people who are being treated with kid gloves by HMRC and allowed to doge tax with relative ease, while you’ve got builders, hairdressers, plumbers and taxi drivers who earn significantly less but pay more tax, and if an investigation takes place these are the people who are – quite frankly – hammered.
People write in all the time and say that they feel HMRC has a personal vendetta against them, I write back and say, that’s normal, that’s how everybody being investigated feels.
So will HMRC now stop being so hard on Joe public and start going for the Big Boys? I don’t think so, but then I’ve been wrong before.
Guardian quote taken from here. The shocked quote comes from an interview in the Telegraph, which is here.
