A committee of MPs has raised doubts about HM Revenue & Customs’s plans to digitise its services.
The public accounts committee said HMRC had staked a lot on the project’s success but had no plan if demand for its call centres does not go down as quickly as it hopes.
As part of its proposals, published in August, HMRC wants to bring about the “end of the tax return” by moving to a digital system.
At the same time it has committed to reducing staff in its personal tax service by a third in the next three years.
The committee’s chairman, Meg Hillier, pointed out that when HMRC made some 5,600 staff reductions in 2014/15, customer service for personal taxpayers collapsed and it had to recruit 2,400 more staff the following year to stabilise services.
She said: “The lack of a convincing fall-back plan to safeguard service as HMRC undergoes significant change remains a looming threat to its ability to collect tax from individuals simply trying to pay their fair share.
“HMRC’s senior management cannot afford to be complacent about the catastrophic collapse in customer service in 2014/15 and the first half of 2015/16, nor about what is at stake should their projections about demand for call centres prove wrong.
“Contingency planning should not be an optional extra. By the Spring we will expect to see evidence that HMRC has agreed measures with the Treasury to ensure it is not left playing ‘catch-up’ at taxpayers’ expense.”
Another concern for the committee was that HMRC did not publish enough information about tax reliefs, saying it only released cost data for 15 per cent of them.
It said the information it does publish about tax reliefs are scattered over a number of different publications and not accessible.
The committee also said HMRC was still receiving too many complaints, with 80,400 received in 2015/16 compared to 74,400 in 2014/15.
Meanwhile 85 per cent of the 1,808 complaints referred to the tax adjudicator in 2014/15 were upheld in part or in full.
Ms Hillier welcomed the fact HMRC had taken action on the amount of time taxpayers spent waiting on the phone.
HMRC has said it has managed to reduce the average waiting time to below five minutes, and is now aiming to reduce it to below three.
