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Tax clampdown under threat as Revenue & Customs plans 300 job cuts Tax clampdown under threat as Revenue & Customs plans 300 job cuts
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George Osborne's budget promise to fund a clampdown on tax evaders appears to be under threat after a leaked memo showed that HM Revenue & Customs is to lose up to 300 staff this year.George Osborne's budget promise to fund a clampdown on tax evaders appears to be under threat after a leaked memo showed that HM Revenue & Customs is to lose up to 300 staff this year.
Mary Aiston, HMRC's director of specialist tax, which targets high-end taxpayers and complex cases, has written that the jobs from the unit will go by 2015 – and adds that those who remain will be asked to deliver more revenue with less resources.Mary Aiston, HMRC's director of specialist tax, which targets high-end taxpayers and complex cases, has written that the jobs from the unit will go by 2015 – and adds that those who remain will be asked to deliver more revenue with less resources.
Her statement sits uneasily with the chancellor's claims last week that the government would increase HMRC's budget to tackle the non-payment of tax.Her statement sits uneasily with the chancellor's claims last week that the government would increase HMRC's budget to tackle the non-payment of tax.
Ministers have faced a public backlash for allowing large corporations such as Vodafone and the bank Goldman Sachs to come to cosy deals with HMRC over multimillion pound tax debts while small businesses and individuals have been hounded for payments.Ministers have faced a public backlash for allowing large corporations such as Vodafone and the bank Goldman Sachs to come to cosy deals with HMRC over multimillion pound tax debts while small businesses and individuals have been hounded for payments.
Last week Osborne told MPs: "The public tolerance for those who do not pay their fair share evaporated long ago – but we've had to wait for this government before there was proper action. Last week, Osborne told MPs: "The public tolerance for those who do not pay their fair share evaporated long ago – but we've had to wait for this government before there was proper action.
"So today we go further still: I am increasing HMRC's budget to tackle non-compliance," he said."So today we go further still: I am increasing HMRC's budget to tackle non-compliance," he said.
In the memo, posted on HMRC's intranet under the section headed "Mary's Diary", Aiston says she hopes that half of these jobs will be lost through "natural wastage".In the memo, posted on HMRC's intranet under the section headed "Mary's Diary", Aiston says she hopes that half of these jobs will be lost through "natural wastage".
"Looking at our plans, over 2014-15 specialist PT [personal tax] will be about 250-300 people smaller. We will do this by considering each role when people leave specialist PT, whether we need to fill their role and, if so, whether we can move someone into it who is already in specialist PT."Looking at our plans, over 2014-15 specialist PT [personal tax] will be about 250-300 people smaller. We will do this by considering each role when people leave specialist PT, whether we need to fill their role and, if so, whether we can move someone into it who is already in specialist PT.
"We won't be able to make all the changes we need to in this way (what's often referred to as using 'natural wastage') but our plan at this stage is that roughly half of the reductions will be through natural wastage," she writes."We won't be able to make all the changes we need to in this way (what's often referred to as using 'natural wastage') but our plan at this stage is that roughly half of the reductions will be through natural wastage," she writes.
Meanwhile, the targets for the number of customers' telephone calls answered and letters opened has been cut, she said, to 80% within 15 days.Meanwhile, the targets for the number of customers' telephone calls answered and letters opened has been cut, she said, to 80% within 15 days.
"While these are lower than for 2013-14, if we can deliver them consistently during the year across the whole of PT, customers will experience a better service as there won't be the drops in service at peak times," she says."While these are lower than for 2013-14, if we can deliver them consistently during the year across the whole of PT, customers will experience a better service as there won't be the drops in service at peak times," she says.
But despite cuts in staff, Aiston says staff will be asked to bring in more revenue. "On yield specialist PT will have a target to bring in £950m in 2014-15. This is an increase on the 2013-14 target but is less than we are currently forecasting to bring in this year," she writes.But despite cuts in staff, Aiston says staff will be asked to bring in more revenue. "On yield specialist PT will have a target to bring in £950m in 2014-15. This is an increase on the 2013-14 target but is less than we are currently forecasting to bring in this year," she writes.
HMRC is also expected to announce the closure of its Edinburgh office of the high net worth unit – with the 23 staff being split between "local compliance" and "trust and estates".HMRC is also expected to announce the closure of its Edinburgh office of the high net worth unit – with the 23 staff being split between "local compliance" and "trust and estates".
The chancellor unveiled a series of measures in the autumn statement designed to close tax-avoidance loopholes that were hoped would raise £6.8bn. However, the Treasury select committee said earlier this month that the forecasts were "inherently extremely uncertain".The chancellor unveiled a series of measures in the autumn statement designed to close tax-avoidance loopholes that were hoped would raise £6.8bn. However, the Treasury select committee said earlier this month that the forecasts were "inherently extremely uncertain".
"Every year, estimates have to be made of the yield of anti-avoidance measures, in the face of great uncertainty about the outcomes," the committee said in a report."Every year, estimates have to be made of the yield of anti-avoidance measures, in the face of great uncertainty about the outcomes," the committee said in a report.
It said the "fiscal importance" of forecasts had become greater given the size of potential revenues, and called on the Office for Budget Responsibility (OBR), the government's fiscal watchdog, to scrutinise the projections.It said the "fiscal importance" of forecasts had become greater given the size of potential revenues, and called on the Office for Budget Responsibility (OBR), the government's fiscal watchdog, to scrutinise the projections.
An HMRC spokesperson said: "We have to take our share of efficiencies but HMRC's key role of collecting the revenues the country depends on is reflected in additional government funding for key areas such as compliance. HMRC said: "We have to take our share of efficiencies but HMRC's key role of collecting the revenues the country depends on is reflected in additional government funding for key areas such as compliance.
"Digital transformation is enabling us to move staff into compliance work focussed on tackling tax dodging. We have created 2,500 such roles which are more fulfilling and rewarding than old style clerical processing work." "Digital transformation is enabling us to move staff into compliance work focused on tackling tax dodging. We have created 2,500 such roles which are more fulfilling and rewarding than old-style clerical processing work."
Mark Serwotka, the general secretary of the PCS union, whose members work for HMRC, said: "The rhetoric from the government on the need to tackle tax avoidance, which deprives our economy of tens of billions of pounds every year, is completely undermined by its actions.Mark Serwotka, the general secretary of the PCS union, whose members work for HMRC, said: "The rhetoric from the government on the need to tackle tax avoidance, which deprives our economy of tens of billions of pounds every year, is completely undermined by its actions.
"Instead of investing in the department that collects the taxes that fund the public services we all rely on, it is making it harder to chase down these wealthy individuals and organisations.""Instead of investing in the department that collects the taxes that fund the public services we all rely on, it is making it harder to chase down these wealthy individuals and organisations."