Posted on May 2, 2014

One recent story that will have undoubtedly attracted the attentions and concerns of many of those using an accountant in Guildford is the covert plan to allow HM Revenue & Customs to sell the personal data of taxpayers to private firms. Conservative MP and former minister David Davis is among the latest to express dismay, his declaration of the proposal as “borderline insane” prompting similar condemnation from other groups.

Mr Davis told The Guardian that Treasury officials were “clearly” unaware of the risks to data in the digital age, and that they had not yet credibly justified the plan. He added that “Our forefathers put… checks and balances in place when the information was kept in cardboard files, and data was therefore difficult to appropriate and misuse. It defies logic that we would remove those restraints at a time when data can be collected by the gigabyte, processed in milliseconds and transported around the world almost instantaneously.”

The Adam Smith Institute, Big Brother Watch and tax campaigner Richard Murphy have all joined in with criticism of the proposals in the wake of Mr Davis’ comments. However, the newspaper  in which the MP was quoted added that the initiative had already commenced, with reports suggesting that VAT registration data has already been released as part of a HMRC pilot scheme to Equifax, Dun & Bradstreet and Experian. Despite this, there is no reference to this relationship with the department on any of the three firms’ websites.

Mr Murphy’s Tax Research UK commented: “The very same companies who object to filing information on their tax affairs that will ensure they pay the right amount of tax…will now be able to buy information on the tax affairs of people who do just that. You really could not make up such staggering hypocrisy from both big business and HMRC.”

The history of the tie-up between the three companies and the Revenue can be traced back to the government’s declaration in the Autumn Statement 2013 that it intended to “work on” plans for the release of VAT registration data. The government had stated back then that it would be “announcing decisions” on any such proposals in “early 2014”, although any notification for taxpayers seems to have amounted to no more than a paragraph in the March Budget.

The relevant section in the 120-page Budget report of interest to clients of an accountant in Guildford read: “The government will legislate to provide for a controlled release of non-financial VAT registration data for specific purposes (principally credit scoring) and to a small number of qualified parties (like credit reference agencies).”

However, HMRC did attempt this week to reassure taxpayers, saying that a consultation would apply to any plans to increase the availability of aggregated and “anonymised” data. The Revenue emphasised that any such “specific measures” would be subject to “suitable safeguards”, with the requirement that they demonstrate a “clear public benefit”.