Both the Chartered Institute of Taxation (CIOT) and the Low Incomes Tax Reform Group (LITRG) have welcomed the publication of a major new report published by the House of Lords Economic Affairs Committee on HMRC powers and taxpayer safeguards.

The report from the House of Lords took evidence from the CIOT, LITRG and others into consideration over the autumn and concluded that the powers given to HMRC undermine the rule of law and access to justice.

Commenting, CIOT tax policy director John Cullinane said: “A new review is needed – albeit one that should not be as extensive and lengthy as the last one – to establish the principles that should govern HMRC’s powers in a digital age. Such a review should start at stage 1 of the consultation process asking what broad changes might in principle be necessary to the 2005-12 framework, and why; acknowledging that the ultimate way forward will need to take account of the piecemeal changes since.

“The transition to digital is transforming tax administration; the nature and operation of HMRC’s powers needs to reflect this fundamental change. The last comprehensive powers review took place before this digital transformation was under way.”

LITRG team head Victoria Todd stated that the group was “pleased” that the House of Lords has listened carefully to the evidence provided by LITRG and other organisations.

“HMRC obviously need powers to administer and enforce the tax system effectively – but those powers need to be proportionate and accompanied by accessible safeguards,” she added.

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