That is the view of Tax Research UK director Richard Murphy, who says a thorough review of the governance of HMRC is required and that it is “absurd” that HMRC’s board is made up of representatives from the large business community and its advisers “who between them represent about 700 tax payers when there are 31m income tax payers in the UK.” He continues: “It is also absurd that parliament has almost no resources available to it to scrutinise HMRC. Margaret Hodge may have done well, but it was despite the NAO and not because of it – indeed, the NAO fought long and hard to deny information on HMRC to the PAC. That is wholly unacceptable and must change, which is why I suggest there should be an Office for Tax Responsibility reporting straight to the PAC that can properly audit HMRC and tax policy.”
Murphy adds that any review should look at the resourcing of HMRC and should have representation from beyond big business and the tax profession. If government cannot be persuaded to implement a review, employers’ groups, professional bodies and trade unions should work together, he says.
He accepts that funding would be an issue, but says a relatively limited number of people producing a report on a timely basis could have a significant impact on taxation in the UK during the next 10 to 20 years.