Here’s a stark contrast.
Today saw the welcome rejection of a Labour proposal to make taxpayers compensate those people who voluntarily bought ID cards should the cards be abolished.
Shadow Home Affairs Minister Meg Hillier accused the Government of having “diddled” ID card enthusiasts, while Denis Macshane hilariously objected to the idea of the State having “confiscated” people’s property. Of course Denis would never otherwise support the forcible seizure of property by the state – through tax, for example – would he?
It’s absolutely right that this amendment was slung out. Governments change and policies are scrapped, that’s the way democracy works. The Conservatives and Lib Dems have long made perfectly clear that they would scrap the intrusive monstrosity of the ID card system.
While the erstwhile MPs on the Opposition benches spoke keenly today of Governments not swindling people, their involvement in the HMRC scandal tells a different story. The tax miscalculations that are landing huge numbers of people with massive extra bills took place on their watch, and were certainly made worse by the complexity they introduced to the tax system.
While Meg Hillier demanded “justice” and “fairness” for ID card holders she turned a conveniently blind eye to the injustices of the system for dealing with tax miscalculations. If you overpay tax, you only have the right to backdate claims for recompense from HMRC for four years. However, if you underpay then the taxman can backdate his demand for six years.
Such a system is unfair and unjust – but Meg Hillier should know that, seeing as she was a Minister in the Government that introduced the imbalance to the system. Perhaps she could take that up as her new crusade?
In my first few days at the TaxPayers’ Alliance, the HMRC data loss scandal broke. An agency that compels people to hand over their money and their personal details had exposed a horrific inability to fulfil its responsibilities to the public.
And now they’ve done it again. The announcement that 5.7 million people were taxed incorrectly, and at least 1.4 million are left facing huge bills to repay, shows that if HMRC has changed at all it has gone from embarassingly mediocre to irretrievably catastrophic.
The one redeeming feature of the taxman’s behaviour when they lost all that personal data was that its Chairman, Paul Gray, resigned as soon as the scandal came to light (though that was swiftly tempered when we found out how much he was being paid to leave). This time, the opposite happened – Dave Hartnett, HMRC’s permanent secretary for tax, swanned about at the weekend saying “we didn’t get it wrong” (which they clearly did) and there was therefore no need to apologise (which there obviously was).
Under pressure from the Treasury, Hartnett has now changed his tune and said sorry. But sorry is not enough – numerous senior heads must roll for this appalling and repeated incompetence.
The people deserve to see blood, the people responsible deserve the axe and HMRC itself a proper bloodletting if it is ever to recover. HMRC’s boss should get out his chopping block, or the Chancellor should do it – and sack him too.
In the short term, the tax authorities need a kick up the backside. In the long term, the only solution to the continued failure to administer the tax system properly is vastly simplifying our taxes. If we had simple, flat taxation there would be almost no need for an HMRC at all – people could work out their own taxes and instead of this blundering behemoth all we would require would be a few little old ladies to open the envelopes and cash the cheques.
They couldn’t be any less competent than the current bunch, and they would have a lot fewer ways in which they could ruin people’s lives.