In recent days, HM Revenue & Customs (HMRC) has confirmed to MPs that as many as 39 of its planned projects have been ‘put on hold’ ahead of Brexit.
According to reports, the various challenges the Government faces in the years ahead – such as negotiating Britain’s customs position post-Brexit – have forced HMRC to hold back on a number of its key projects until Britain’s future looks a little more certain.
The news comes shortly after leaks suggested that HMRC’s flagship Making Tax Digital (MTD) project would be delayed for individuals as the Government moves to focus its efforts on other, Brexit-specific activities.
A report in City A.M. suggests that, scaling back on MTD and other plans, such as the proposed scrapping of the annual tax return, could cost the Government billions of pounds worth of tax generated by HMRC.
This is in part due to the fact that it has previously been estimated that scrapping the annual tax return will save HMRC some £8 billion a year.
Elsewhere, reports suggest that other delays relating to IT projects, such as the creation of an online Inheritance Tax (IHT) service, could also have a negative impact on efficiency and tax collection.
However, an HMRC spokesperson has said: “HMRC has carefully considered the scale and pace of its transformation to ensure that it can deliver work to support [the] EU Exit.
“We’ve been open with MPs and stakeholders about the impact of these changes.”
They added: “Our ambition to become one of the world’s most digitally-advanced tax authorities remains unchanged.”