Saturday, 4 September 2010


Why on Earth does everything in this country have to be so complex?

First issue that I can remember was the Child Support Agency. It was set up in the 90s (with huge support from a public that was sick to the back teeth of picking up the bill for lads whose idea of a good time was a quick one on and Friday night, and whose idea of a bad time was any resultant kind of reduction in their beer, cars and clothes budget). But it was made so complex, and made so many errors, that in the end the public was sick to the back teeth of it.

Then there was the (again) well meaning child tax credits. No one, not matter how anti Labour could say that it wasn’t a good idea to target the very limited amount of money on the poorest. It was of course, as was family tax credit, a subsidy to employers, and thus to jobs. But once again it was so complex that it caused more grief than it gave comfort, and people were terrified of it, lest there be an over payment, which there frequently was, and it be taken back.

Now it’s the PAYE system. It seems that few in the Revenue really understood much of what they were doing. It appears that there is likely to be an overhaul of the way that tax is calculated which probably means that once completed, no one will understand what they are doing; the computers won’t be able to cope with it and the whole system will collapse.

This latest mess means that the wrong tax has been taken from around 1.4 million people. Some have paid too much, some too little. Those who have overpaid will receive an average rebate of just over £400 which will be paid to them by cheque.

Those who have been underpaying (around 1.4 million) will, have to pay money back. The amount will be taken in installments from their pay. The average amount is likely to be around £1200 and this will be taken at about £100 a month. Tax codes for next year will be altered to ensure the money is recouped over a year. Nippy at a time when prices are likely to rise steeply and salaries are likely to be static unless you are among the top earners..

Knowing my luck, and based on my past experience with HMIR, I will get a bill for 3 times my annual income and they will refuse to accept that they could possibly be wrong. The last debacle with them took enough phone calls to pay the BT chairman’s bonus.

The coalition has blamed the labour government, not unreasonably since they were in charge during the period when it happened.

According to the Daily Telegraph a Treasury source said: “A decade of meddling and intervening made the tax affairs of millions of families and businesses across the UK extremely complicated.”

So no bias there from the Treasury!

Ministers say that the Government is now using a computer system which can match taxpayers’ records up automatically and make sure the right amount of tax has been paid. So...we now have a government computer that does what it’s supposed to do......?

Ha ha ha ha ha ha ha ha ha ha ha ha ha ..... when will they lose all the discs then?

Pic: Clever crest concocted by mehrdad in light of IR,s lost cds back in 2007. The crest is changed to include a cd carried by the lion and the unicorn under the crown and the text changed from the original "Dieu et mon droit" (God and my right) to "Deux cds sont perdus" (two cds have been lost). It is copyright, and I hope they will excuse my non-commercial use of it. It sums the department up pretty well.


  1. Our whole approach to taxation in this country is out of touch with the needs of today.

    Not only, as you point out Tris, is the current record with data protection completely incompetent. But our problems go deeper.

    We have the longest tax code in the world, one which punishes the poorest disproportionately than the richest. Additionally how many times has the tax office made mistakes with how much people owe? And the net result of the exchequers incompetence; well under the last 13 years we saw countless repayments needed - all of which naturally punished those who could least afford it.

    Naturally the sceptical side of me suspects that these are not new problems, but ones which have been around for donkey's years.

  2. Dean

    I just watched a money expert on BBC News saying that the system dates back to 1946 and is totally inadequate for today's needs.

    He said that had had become unnecessarily complicated over the last 15 years (so our mate Ken was involved).

    He also said that, as the same computer system (£360 million worth of it) would be making the new calculations, there was no real reason to suspect that they would be accurate wither.

    He advised that people who thought they had paid too much, should appeal.

    One of the features of the current situation that I find hard to take is that they have made the errors, and they have made them over two years, yet they seem to want to take the money back in one tax year.

    Are there any human beings in the Treasury? Do they realise how hard pressed ordinary people are, and how difficult it will be to find an extra £1500 in 12 months?

  3. 'wither' should, of course, be either....

    .. and I should check before I press the send button!

  4. HM Treasury is like a poorly made wheel which is impossible to balance no matter how many weights are added. Time to start afresh but since we are dealing with a backward system of government which won't change as it thinks its the centre of the universe. Revolution anyone.

  5. Makes those of us who call for a flat rate tax across the board, seem eminently sensible. Of course that might put a good few civil servants out of a job which is why it will never happen.

  6. CH: If they come after me for £1500 in a year there will be a personal revolution going on. I'm not sure how it will manifest itself though... seeing as we are pretty powerless over the PAYE system. I'll probably just moan a lot on here.... and cry....

    If, however, something is not done about reducing the tv licence, I will take the action of instructing my bank (a part of the government) to withhold the 12th payment in the year from the BBC (another de facto part of the government).

    They will probably refuse to do it.

    Hmmm. I'm a wee bitty pathetic here I'm thinking!!

  7. QM: It's an interesting concept this flat rate thing. I should read more about it. I know it sounds terribly unfair at the outset but I have a feeling that some really progressive countries do it.

    And somehow it seems to work.

    I think that, unless Mr Osborne's been pulling our legs there are going to be some BIG reductions in the Civil Service. I suppose that we should brace ourselves for even more inefficiency; even longer waiting on the phone being told that our call is important to them and even more errors in whatever they send us...

    Still, what governments say and what they do aren't always the same thing.

    How's your weekend at home going....?

  8. tris it wont be a tax demand it will be a request that you have underpaid so one can question their judgement. I am listening to 5live and a I? 18 or 19 clause comes into play so this could well backfire big time if it ends up costing the revenue. Steve Nolan is talking about it at 10pm. Pity we are not grown up enough to have a similar radio in Scotland.

    As an aside the real news in Scotland can be found here.

  9. Thanks CH.

    I only just saw your comment, so clearly I missed Steve Nolan's piece.

    Did it make things any clearer?

    Newsnet Scotland is an excellent site.

    Thanks for reminding me about it.

  10. Not yet he's on till one el vino might no last that long. Ed Balls was on a bigger speaker of untruths since Blair. Tax on now!

    One for Dean

  11. Independence - a HUGE bet on oil prices...not a sensible basis for independence in my book