ARC, the union representing senior HM Revenue and Customs officials, has said that further cuts to HMRC announced in today’s Comprehensive Spending Review announcement show a lack of vision and are wholly counterproductive.
ARC President Graham Black said:
“In piling another 15% of cuts on top of the 33% already suffered by HMRC since 2005, the Government has placed huge amounts of tax at risk. The amount of tax due but not paid by people who cheat the system is close to £60 billion by the Government’s own estimates. This accounts for almost one third of the budget deficit. The further cuts announced today mean this figure will increase and must call in to question HMRC’s ability to police the tax system effectively. Any increase in the amount unpaid means even bigger cuts elsewhere and even higher taxes for honest taxpayers.”
The earlier announcement by Danny Alexander of a £900 million investment in HMRC was given a cautious welcome by ARC.
Black said: “Our fears that this limited investment would be funded by far larger cuts elsewhere have now been confirmed. The net cut to HMRC resources, after taking account of this reinvestment, is 15%.
“It means that, as we plug some of the holes, other larger holes will appear elsewhere. At least 13,000 jobs will go, and HMRC will around half the size it was a few years ago. We know that each ARC member can generate at least 30 times their salary in additional tax. But the converse is also true: for every £1 saved through these cuts the cost in lost revenues will be at least £30.
“Senior Coalition ministers have spoken the language of cracking down on tax cheats, but it looks like it was nothing more than warm words, as this is a charter for tax cheats and puts a lie to the mantra that we are all in this together.
“This is a missed opportunity. We called on the Government to demonstrate boldness, vision and delivery. But what we have heard is caution, indecision and spin.”
ARC estimates that today’s announcement will mean that further billions of tax revenues will be lost over the four years to 2015, on top of the £170 billion that will be lost on current trends.
ARC’s report Being Bold – a Radical Approach to Raising Revenue and Defeating the Deficit was published on 8 September and recommended increasing the number of HMRC tax professionals to tackle tax cheats and raise funds for the Exchequer.
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. It is also a section of the FDA.
2. The FDA is the trade union and professional body representing 18,000 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. Graham Black, ARC President, is available for immediate comment on today’s announcement.
5. For further information contact:
- Graham Black, ARC President, tel: 020 7401 5559 or 07766 497976.
- Debbie Stamper, ARC officer, tel: 020 7401 5555.
- Graham Flew, ARC officer, tel: 020 7401 5555.