Last Friday the Guardian told of the triumph of customer service over the traditional business of investigating tax avoidance and evasion at HMRC. This blog has highlighted the retreat from the fight against cross-border tax avoidance through "transfer pricing" manipulation. The theme is taken up by a reader with a longer memory:
Too many chiefs and not enough Indians? The comments in the "tax gap" articles about the Revenue's appointment of customer relation officers, and the imbalance between the Revenue's frontline resources and those of the tax avoidance industry, reminded me of my Welsh ancestry. One of the things that sped the end of the coal industry in this country was the NCB's mindless policy of having more men above ground in admin-type jobs than they had at the coal face. Each miner carried so many overheads (literally) that the price of coal became prohibitive.
Surely HMRC can see that investing considerable sums of money into training tax investigators, and then use them in admin/personnel type jobs has nobody's support, save for big business, who must have a better chance of avoiding tax, and a pool of underused tax experts to recruit from. Of course this kind of thing happens in local authority and the health service, but at least in these entities it is more visible and open to challenge. Why have MPs so little influence over HMRC policy?
MPs did look at HMRC's approach to large business (pdf) but didn't address this point, preferring to swallow anecdotal reassurances that their strategy of persuasion was succeeding. After the Guardian's revelations, they might want to have a rethink.
