Select Committee on Treasury Appendices to the Minutes of Evidence


Memorandum submitted by the Public and Commercial Services Union


  1.1  This evidence is submitted by the Inland Revenue Group of the Public and Commercial Services Union which represents over 53,000 members in the Inland Revenue.

  1.2  PCS representatives negotiated the implementation of Self-Assessment in the Inland Revenue and they continue to represent several thousand members responsible for the daily administration of Self-Assessment.


  2.2  The Sub-Committee's terms of reference cover the objectives, operation and achievements of Self-Assessment.

  2.3  We summarise our views under those three headings as follows together with some recommendations for the future.


Self-Assessment: A Simpler Tax System

  2.5  Self-Assessment has failed to deliver a customer friendly, easy to use system. Taxpayers find the SA tax return difficult to complete and Inland Revenue staff find the system hard to administer to the high quality standard they wish to achieve.

Improve Tax Compliance

  2.6  Self-Assessment has produced mixed results in terms of taxpayer compliance. Overall tax receipts have increased as a result of the introduction of Self-Assessment. However compliance coverage is down from 5 per cent of the taxpayer base to between 2 per cent and 3 per cent. This reduction raises concerns about fairness and consistency.

Reduce the bureaucratic burden on taxpayers

  2.7  Taxpayers feel Self-Assessment has placed more paper work upon them, that it is complicated and as a result of the SA penalties system, threatening.

  2.8  The system for electronic filing over the Internet is still cumbersome. Whilst 76,000 tax returns were filed electronically for the most recent tax year, double the number the previous year, it is still only a tiny percentage of approximately nine million SA taxpayers.


  Self-Assessment has proved to be difficult for the public and Revenue staff to deal with;

    —  too few taxpayers are convinced of the merits of submitting their tax return early for Revenue calculation, although many returns are received on or just immediately prior to 30 September;

    —  too many taxpayers continue to submit their tax return after (sometimes substantially later) than the 31 January deadline;

    —  training for many staff was delivered too early or too late and was not sufficiently detailed, creating a "knowledge gap" amongst staff. Some Regions have recruited casual staff to process SA Returns. The lack of proper training for those casuals and the lack of any incentive for them to do a quality job has undermined quality working and contributed to a high error rate;

    —  the "process now—check later" regime introduced inefficient working practices which experienced staff resented and created errors which angered taxpayers;

    —  during recent years many Revenue Offices were encouraged to throw taxpayer files away in order to save space/accommodation costs. This has led to inconsistency and inaccuracy. It is a practice that must be stopped.


  2.11  Self-Assessment has raised the public's tax awareness and increased tax receipts. It has also raised the publics expectations in terms of customer service from the Inland Revenue.

  2.12  It has highlighted the need for:

    —  greater consistency across Areas and Regions;

    —  support for rural areas;

    —  greater support for particular groups of taxpayers, eg, pensioners who find the SA Return especially difficult.

  The Revenue has become more customer focused but still has a lot to do.

  2.13  The success of the TELSSA Helpline highlighted the demand for well trained staff to deliver quality services. Better technological support for e-business and telephone services is welcome. The same investment in staff knowledge and skills training is essential to support consistency and quality of service.

  2.14  Face-to-face services in rural areas and local communities are essential for reasons of compliance, social inclusion and the integrity of the tax system.


    —  simplify the Tax Return;

    —  improve the electronic filing system;

    —  make early contact with taxpayers with a history of non-filling or filling late;

    —  improve compliance risk assessment techniques to support fairness, consistency and quality;

    —  introduce an accreditation system for staff training;

    —  provide more services for community groups;

    —  design a bespoke SA Return for pensioners;

    —  improve the exchange of information between Revenue and the Department of Work and Pensions to improve customer support, compliance and reduce fraud;

    —  listen to frontline staff when making changes to the SA system.

Public and Commercial Services Union

19 February 2002

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