Source · Select Committees · Public Accounts Committee
Recommendation 16
16
HMRC is also looking more widely at how it can improve the efficiency of its...
Conclusion
HMRC is also looking more widely at how it can improve the efficiency of its debt management operations. It told us it is undertaking work to use its data to better understand which type of contact is most effective in bringing customers to repay their debts and target activity accordingly. For example, whether a particular customer is likely to respond positively to receiving letters or whether a field visit is likely to be required.38 HMRC’s use of data to understand how taxpayers were affected by the pandemic
Government Response
Not Addressed
HM Government
Not Addressed
5: PAC conclusion: HMRC is not using all relevant data sources to understand how the pandemic is affecting taxpayer’s ability to repay. 5: PAC recommendation: HMRC should identify and obtain the data sources which are most relevant to understand the ongoing impact of the pandemic on businesses. As a minimum we would expect HMRC to make use of sectoral data. 5.1 The government agrees with the Committee’s recommendation. Target implementation date: December 2022 5.2 HMRC recognises the importance of using relevant data about businesses to understand their ability to pay their debts and that this is important beyond the impact of the pandemic. HMRC already has access to a lot of data about businesses through their various tax returns. HMRC used changes in turnover, visible from VAT returns, and changes in the number of employees and overall pay bill, visible from PAYE returns, when assessing how businesses had been impacted by the pandemic. 5.3 HMRC will combine its response with recommendation 4 and set out what data it is using, or planning to use, to assess ability to pay and why. Acquiring, analysing and using data has financial and opportunity costs, so it is important to consider the value for money of each data source. 5.4 HMRC will re-assess the extent to which sectoral data adds value to its segmentation approach. However, previous analysis has shown that it is less effective than business- specific data as impacts within sectors can vary widely.