SHADOW chancellor John McDonnell called yesterday for plans to close dozens of tax offices to be ditched after a “damning” report was released by Whitehall spending watchdog the National Audit Office (NAO).
He said HM Revenue and Customs’ (HMRC) proposals to replace 170 offices with 13 regional offices, four “specialist” sites and a London-based headquarters were an “emerging disaster.”
HMRC has been forced to rethink the proposal as the scale of disruption involved — including the loss of around 5,000 jobs — had been underestimated, the NAO revealed.
The estimated estate costs over the next decade have risen by nearly £600 million — or 22 per cent — since HMRC first presented its plans in 2015, because of higher than expected office running costs.
HMRC faces paying even more if downsizing is not completed by 2021 because of a private finance initiative deal with Guernsey-based property contractor Mapeley.
Mr McDonnell said there remained a tax gap of at least £36 billion.
Financial Secretary to the Treasury Jane Ellison said in the Commons: “It’s nonsense to say that capabilities have been diminished. The tax gap is at its lowest ever and lowest in the world.”
The total HMRC projected efficiency savings by 2025-26 are now less than half of the £499m previously forecast.
Public and Commercial Services union general secretary Mark Serwotka said: “Cutting thousands of HMRC staff in recent years has hit the services it provides, yet HMRC and this Tory government are ploughing ahead with poorly thought through plans that would mean thousands more job cuts.”
Shadow Treasury minister Rebecca Long-Bailey said it was clear that HMRC was still not being given sufficient resources to tackle tax avoidance, even after the Panama Papers scandal last year.
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