19 February 2013
(For immediate use)
Today's Public Accounts Committee (PAC) report - Tax Avoidance: Tackling Marketed Avoidance Schemes - makes much of naming and shaming promoters of avoidance schemes and adopting the Australian model of advance rulings on schemes, but says little about the need for more resource and adequate reward for HMRC staff says the Association of Revenue and Customs (ARC), the union representing senior staff in HMRC.
ARC President, Gareth Hills said: "We welcome PAC's comments on having an advance rulings system. Indeed, in ARC's response of April 2012 to the limited GAAR the Government intends introducing, we said that a more general GAAR - with a properly resourced clearance system - would allow avoidance to be identified and tackled whilst leaving responsible tax planning untouched."
Hills also welcomed PAC's comments on 'naming and shaming', but said that would require legislative change: "In an era of austerity, ARC has argued consistently that securing the right amount of tax is more vital than ever. The Government needs to give HMRC the tools to allow it to crack down on avoidance and evasion. And it needs to adequately reward those working hard to bring in money to help build a better Britain."
But Hills is disappointed that the PAC report is silent on the need for further investment in HMRC, over and above the £77m announced in last year's Autumn Statement: "ARC published its interim investment proposals in December last year to help reduce the deficit and close the tax gap, and showed how an even relatively small scale investment of £120m would recoup currently lost tax of £3.7bn
"The scale of the overall budget deficit of £126billion, and the tax gap of £32 billion, are such that the Government needs to put significant investment into HMRC. By investing in key personnel in HMRC the Government will be guaranteed a significant return - one it could use to draw down the deficit, to avoid further austerity measures, or to fund economic recovery and growth. Now is the time for it to abandon caution, the time for it to be bold, and the time for it to back a cast-iron winner."
Notes for editors
1. The Association of Revenue and Customs (ARC) is a union representing senior staff in HM Revenue and Customs, including tax inspectors, accountants, lawyers, managers and other leading professionals. ARC represents members in HMRC at grade 7 and above, and also trainees in grade 7 entry schemes. It is also a section of the FDA.
2. The FDA is the trade union and professional body representing 19,000 of the UK's senior civil and public servants. Our members include policy advisors, senior managers, tax inspectors, economists, statisticians, accountants, special advisers, government lawyers, diplomats, crown prosecutors and NHS managers.
3. The FDA (formerly the First Division Association) should be referred to simply as "The FDA" and can be described as "the senior public servants' union".
4. ARC's April 2012 GAAR response can be read at: ARC response to the Aaronson GAAR study.
5. ARC's interim investment proposals can be read at: Reducing the UK Tax Gap - Proposals from ARC
6. For further information contact:
- Gareth Hills, ARC President, tel: 020 7401 5555 or 07870 592356.
- Kay Hender, FDA Communications Officer, tel: 020 7401 5589 or 07980 700747.