We acknowledge HMRC’s proposals to extend its existing enforcement power to recover lower-value tax debts from customers who have persistently not engaged with HMRC to reduce the tax gap.

We understand that lower-value tax debts present distinct challenges in comparison to higher-value tax debts, which highlights the importance of ensuring that HMRC’s proposals are operationally feasible and deliverable if they are to succeed.  

However, we do not support HMRC’s proposals in its current form as we believe there are a  number of concerns that should be addressed before HMRC implements this measure. 

It is crucial that HMRC carefully considers and addresses several areas, including potential Consumer Duty implications, ensuring that their policies and processes are clear and fit for purpose, completing an evaluation of products and taxes within scope, confirming a de minimis debt value, evaluating the inevitable implementation and admin costs for banks and building societies and the management of customer complaints.