Lords committee to investigate HMRC powers

This inquiry will cover:

HMRC powers

• What principles should underlie the design of HMRC powers, and where should the balance be struck between taxpayer and tax authority?
• What principles should govern the development of HMRC powers in a globalised digital information age?
• To what extent, or in what areas, is the existing balance of powers between HMRC and the taxpayer inappropriate or unfair?
• How should HMRC powers be differentiated to reflect the different problems being tackled e.g. careless error, sophisticated tax avoidance, and deliberate tax evasion?
• How are HMRC's powers operating in practice? Are they being used in line with their original policy intent?
• Is there sufficient oversight of HMRC powers, and safeguards against their abuse or misuse? Does the oversight and governance of the powers need to be improved? If so, how?
• What is the right balance of powers and safeguards in the security deposit regime and the assessment of offshore matters, for which amendments are proposed in clauses 33–35 of the draft Finance Bill?
  

Making Tax Digital for VAT

• What key improvements have occurred, or new concerns have arisen, since the Sub-Committee's report on Making Tax Digital for Business was published in March 2017?
• How prepared are HMRC, businesses (small and large) and software providers for the implementation of Making Tax Digital for VAT in April 2019, and what are the challenges of concurrent preparations for Brexit?
• What are the potential costs of Making Tax Digital for VAT for businesses?
• How could the penalty regime and the new VAT interest regime proposed in the draft Finance Bill be improved or simplified?
• What are the implications of having different penalty regimes for different taxes?
  

Lord Forsyth of Drumlean, Chairman of the Economic Affairs Finance Bill Sub-Committee, said:

“HMRC's powers to tackle tax avoidance and tax evasion have expanded exponentially in recent years. The Sub-Committee will investigate the practical impact of these new powers on the taxpayer.

“We will also consider whether Making Tax Digital for VAT is on track for introduction in April 2019, and whether sufficient support for businesses will be in place in time.

“We want to hear from a wide range of people and organisations, in particular those who may have experienced the use of HMRC's powers or be preparing for Making Tax Digital, and we are looking for sensible, pragmatic recommendations on how the current approach to these issues could be improved.”

The deadline for the submission of written evidence is 1 October 2018.

Click here for more information on the inquiry, and details on how to submit evidence.