How much longer can HMRC continue to take the strain?

None of us are great fans of HMRC and in fact if you look at the evidence the House of Commons Select Committee has been presented with it would seem that nobody has a single good word to say about the government department.

Accountants, business owners and members of the general public are disgruntled by the Revenues attempts at customer service and the furores surrounding recent computer errors have done nothing to improve its reputation. There is no doubt in anybody’s mind that significant change is required.

HMRC, like other government departments, is having its budget slashed as part of the government austerity measures. On top of that, it is expected to reap in more money and cope with the changes announced in the recent budget. How will it cope?

The CBI recently said that staff turnover in the Revenue was too rapid and we’ve also heard that morale in the department is at an all time low. The confederation also complained about the loss of staff dedicated to specific clients/companies and points out that HMRC suffers from a lack of internal communication.

Isn’t the government shooting itself in the foot with this cost cutting stance, especially where HMRC is concerned? Reducing the number of tax inspectors reduces the revenue generating capabilities of the department. In 2005 when the department was formed, it had over 100,000 employees. 25,000 of them have already gone and it is thought another 11,500 will shortly follow.

Some people believe that HMRC is the one department that should receive extra funding as it is the only one that actually generates income. If George Osborne is serious about cracking down on tax evasion, shouldn’t the government rethink the whole HMRC situation?

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