HMRC can't be trusted with our bank accounts


If ever we needed proof the government doesn't trust UK citizens it is writ in the plan to strengthen the taxman's 'debt recovery powers'.

Overshadowed by the pension and savings giveaways in the Budget, nobody noticed the subtle arming of HM Revenue & Customs (HMRC) with the ability to raid taxpayers' bank accounts.

That's right; the Budget proposed to give HMRC the power to recover money directly from taxpayers' bank accounts if they have underpaid or owe tax monies.

This underhand tactic, in my opinion, is a way of saying to taxpayers that they are not trusted by the state to pay their dues, and the Treasury Select Committee is just as worried, saying it could denote a preference for 'stealth' measures.

Of course there will be a consultation and the committee has said it will provide further evidence, but it is gravely concerned about this power being handed out 'without some form of prior independent oversight' such as an ombudsman or tribunal.

The chancellor's thinking is that the measure is justified because the Department for Work and Pensions is already allowed to take money from people's bank accounts to pay child maintenance but that is a slightly different power – DWP is working purely as an intermediary rather than acting for its own gain.

The main flaw in this plan is HMRC's incompetence. Quite often underpayment of tax or incorrect tax repayments are the fault of the taxman not the individual. I have been overpaid nearly £1,000 of tax in the past only to receive a demand from HMRC six months later to pay it back.

What if I had spent it and didn't have the means to repay it? If the taxman had the power to just take it from my account would I have been pushed into debt – on which I have to pay overdraft charges – because of HMRC's mistake.

These are the practical considerations of dealing with a tax department for which mistakes are frequent and often financially crippling for people – we only have to remember the widespread overpayment of child benefit to lower income families who were then forced to pay the money back.

HMRC does not need anymore grasping powers. I know we are in the midst of a 'recovery' (albeit one standing precariously on inflated house prices) but tackling the small sums owed by law-abiding taxpayers rather than tackling those who fail to pay large sums in the first place is a nonsense.
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