Chronic delays at the tax office are so bad they are hurting the economy, accountants have warned.
Tax trade bodies representing accountants have said customer service at HM Revenue & Customs (HMRC) has reached a “new low” and said the tax authority is failing to do its jobs effectively, with phone waiting times and postal backlogs having a significant impact on businesses and individuals.
Gary Ashford, president of the Chartered Institute of Taxation, said the impact of the delays was a strain on the economy.
“Poor HMRC performance, such as delays in processing registration for taxes and the inability to quickly resolve matters doesn’t just harm the tax system, but has an impact on the wider economic climate too,” he said.
“Businesses are left unable to trade properly, individuals are left without much needed repayments, and costs spiral as they repeatedly chase HMRC for progress updates.”
It comes after the tax office said that it would scrap the ten-minute waiting time target on its dedicated agent helpline, despite the fact that call waiting times now exceed 20 minutes on average.
Michael Izza, chief executive of the Institute of Chartered Accountants in England and Wales (ICAEW), said that the delays had stopped tax agents from being able to complete their work.
“Removing the 10-minute service level on the Agent Dedicated Line represents a new low in HMRC’s declining performance,” he said.
“Agents play a key role in the tax system and if they can’t work effectively there is a significant knock-on effect on the UK economy.”
The ICAEW added that HMRC’s poor online services have left its members reliant on phone lines and written correspondence despite waiting times.
“It seems clear that HMRC does not have the tools to manage the tax system effectively and efficiently, so to restore confidence we want to see a thorough review with a plan to improve services and develop digital capabilities for the future,” Mr Izza added.
The claims come after a survey by the Chartered Institute of Taxation found that 94pc of its members asked were “somewhat” or “extremely” dissatisfied with HMRC’s service levels, with 95pc also claiming that the tax office’s poor service had at least moderately impacted their ability to do business.
Tax calculator: how much you will pay on savings (and easy ways to cut it)
More than half of the tax agents surveyed said that they have waited for more than thirty minutes for a response from HMRC’s specialist agent helpline, a figure that increased to 85pc for other HMRC helplines.
The tax office closed its self-assessment helpline over the summer in an attempt to deal with its backlog of postal enquiries, and created a special taskforce to deal with more than 37,000 pieces of correspondence that were at least 10 months old.
HMRC has also been criticised for keeping its staff at home, with as many as two in five workers at regional centres having stayed away from the office completely in the year leading to March.
The tax office has repeatedly said that remote working has had no impact on the number of phone calls its staff respond to.
It has also said its online services have been improved, adding customers should attempt to use these before contacting the office online or by phone.
An HMRC spokesman said: “Last year, we received more than three million calls on just three things that can easily be done digitally – resetting an online password, getting your tax code, and getting your National Insurance number. That’s almost 500 people working full-time to answer just those calls.
“To free up our advisors to help those who need one-to-one support, it’s important callers are encouraged to use our online services wherever possible. The ICAEW and CIOT know this and, through the agents they represent, can play a valuable role in helping drive change.”