Are you having problems getting through to HMRC with your tax queries ? Here’s why…..
HMRC has experienced a decline in full-time staff, coupled with a high turnover rate, despite increasing taxpayer complexity and demand.
The organisation’s workforce has shrunk to 61,186 employees, down from 62,174 in the previous year. This is due to a higher number of staff leaving the organization than being hired to replace them. Despite this, HMRC continues to employ over 1,700 short-term contractors, many of whom have been with the organization for extended periods.
HMRC’s total budget has increased to £7.22 billion, with nearly half allocated to staff costs. However, the organisation has faced challenges in meeting service standards due to rising taxpayer demands and budget constraints.
A significant factor contributing to the strain on HMRC is the growing number of taxpayers with complex tax affairs. Over two million individuals have been brought into the tax system due to frozen thresholds, leading to increased customer contact and compliance challenges.
The tax gap, the difference between the tax that should be paid and the tax that is collected, remains a significant concern. HMRC has made progress in collecting outstanding tax, but the complexity of cases and limited resources have hindered efforts to close the gap.
HMRC’s chief executive, Sir Jim Harra, acknowledged the challenges faced by taxpayers and agents in interacting with the organization. He emphasized the need for investment in digital services to reduce reliance on helplines and improve overall customer experience.
While HMRC has made progress in certain areas, such as speeding up VAT registration and exploring the use of AI, the organization continues to grapple with staffing shortages, budget constraints, and increasing taxpayer demands. Addressing these challenges will be crucial for HMRC to effectively fulfill its mandate.
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