Scots Tax Body At Risk Of Failing

A Scottish version of HMRC could fail because of failures in setting up the body, according to a report.

Audit Scotland says there were errors in recruiting enough staff and delivering the required IT system. 

It means payments could take longer to process, and increased costs of collection.

New laws come into force in April devolving power to replace the stamp duty, landfill tax and other financial powers.

This is separate to the further devolution promised through the Smith Commission.

Caroline Gardner, Auditor General for Scotland, said bringing in the Scotland Act 2012 is "a large and complex task" that will "change the landscape for public finances in Scotland", increasing fiscal autonomy and strengthening the accountability of the Scottish Parliament.

She said: "The Scottish Government successfully developed the legislative framework for the devolved taxes, but it must ensure that staff and systems are fully in place to manage the increased responsibilities that the Scotland Act brings.

But, Finance Secretary John Swinney said the Scottish Government's approach has been "widely praised for our consultation with those who use the system and our efforts to crack down on tax avoidance."

He said "“Today’s report shows that Revenue Scotland is on track to manage collection of the new devolved taxes from April 1st next year.

“This report rightly acknowledges that establishing the arrangements for our new financial powers is a ‘large and complex programme of work’.

"Establishing a new tax collection agency from scratch is a major operation – Revenue Scotland staff are rising to that challenge and I welcome Audit Scotland’s recognition of the excellent work done on policy development and legislation.

“They have found that clear programme structures and well-developed project plans are in place to manage the devolved taxes and they acknowledge that this is a live programme where substantial activity continues.

“We are closely monitoring Revenue Scotland’s progress ahead of its go-live date in April. I am confident we have robust plans in place to ensure smooth delivery of the service and it is heartening to see this thorough planning acknowledged by Audit Scotland.”

Iain Gray MSP, Shadow Cabinet Secretary for Finance, said Mr Swinney "must take responsibility for the catalogue of failings" in the report.

He said: "This reports blows a hole in any credibility the Scottish Government had left.

"We know the Scottish Government’s obsession with independence  has put them on pause and this report confirms that.

"It’s staggering that part of the failure is a result of too many staff having other commitments, perhaps if Civil Servants hadn’t been instructed by their political masters to focus on the referendum then plans to make sure tax is collected would not be in the shambles they are.
 
“The SNP has spent the last 3 years calling for more tax raising powers. This is laughable given their inept stewardship of the ones they already have. This is money that goes to support schools and hospitals and John Swinney must make an immediate statement on what steps he is going to take to make sure that this shambles is put right.”