Tax professionals are calling on the Government to provide assurances that it is not going to start selling taxpayers’ data. The Association of Taxation Technicians (ATT) is also pressing for a firm assurance from HM Revenue & Customs (HMRC) that robust safeguards, with legal redress, will be put in place to protect individual taxpayers from identification if data is shared with accredited third parties for research and analysis.
The ATT has noted the recent expressions of concern that the Government is considering ‘selling’ data about taxpayers. Given that HMRC published its response1 to consultation2 on the subject of data sharing as long ago as 10 December 2013, the ATT thinks it is important to remember the subject matter of that consultation. It was specifically about the possible merits of removing legal constraints in order that HMRC could firstly publish general and anonymised data about taxpayers and secondly share “anonymised individual-level data with accredited third parties for the purposes of research and analysis”. Fundamental to any change was the requirement that the publication or sharing should be for public benefit.
Many of the concerns now being raised echo those of bodies like the ATT at the time of the consultation. We noted3 that in relation to data that is specific to a taxpayer, HMRC are its custodians and not its owners. It is ‘ours’ rather their ‘theirs’. However, what is getting rather lost in the current debate is what constitutes public benefit. Provided that there were adequate safeguards, few taxpayers would probably object to changes in the law to enable HMRC to provide aggregated and anonymised data to another government department in order to better inform its decisions (something that is surprisingly constrained by current legislation). What is less clear is how to identify what, if any, public benefit might result from sharing anonymised but individual-level data with third parties for research and analysis. We observed in our response to the consultation that it appeared to proceed on the basis that it was self-evident that sufficient public benefit would necessarily flow from the sharing and publication of data to justify the very significant modification (if not erosion) of what is understood by the fundamental principle of taxpayer confidentiality.
ATT President Natalie Miller commented, saying:
“There is a real risk that the current debate becomes dominated by the idea that data may be sold by HMRC. Unless the Government is seriously contemplating that, it has the opportunity to reassure everyone that this is not under consideration. We then need firm assurance from HMRC that robust safeguards will be put in place which protect individual taxpayers from identification.
“Beyond that, ATT considers that third parties to whom HMRC provide any data should be subject to a statutory liability to pay damages should individual data be compromised through publication or loss. In addition, we strongly believe that a taxpayer should have an alternative right of action against HMRC rather than a third party. This is essential in order to avoid a game of pass-the-buck. In its capacity as the custodian of everybody’s personal data, if HMRC decides to share that data for ‘public benefit’, the consequences of that decision lie squarely at the doorstep of Revenue & Customs – in their capacity as the deservedly trusted gatekeepers of the information.
“Finally, and most importantly, we think there needs to be much more attention given to ensuring that any publication or sharing of data by HMRC is demonstrably for public benefit. That concept may not be easy to define but that does not remove the need to do so. Taxpayers are entitled to the assurance that sale of their data in order to bring a few pounds into the Exchequer would not constitute a public benefit.”
Notes for editors
1. More information on HMRC’s summary of responses Sharing and publishing data for public benefit: summary of responses and outcome, can be accessed here.
2. For more information on HMRC’s consultation, Sharing and publishing data for public benefit, can be accessed here.
3. The ATT’s response to the consultation can be accessed here.
4. Association of Taxation Technicians
The Association is a charity and the leading professional body for those providing UK tax compliance services. Our primary charitable objective is to promote education and the study of tax administration and practice. One of our key aims is to provide an appropriate qualification for individuals who undertake tax compliance work. Drawing on our members' practical experience and knowledge, we contribute to consultations on the development of the UK tax system and seek to ensure that, for the general public, it is workable and as fair as possible. Our members are qualified by examination and practical experience. They commit to the highest standards of professional conduct and ensure that their tax knowledge is constantly kept up to date. Members may be found in private practice, commerce and industry, government and academia.
The Association has over 7,500 members and Fellows together with over 5,000 students. Members and Fellows use the practising title of 'Taxation Technician' or ‘Taxation Technician (Fellow)’ and the designatory letters 'ATT' and 'ATT (Fellow)' respectively.More Articles by Chartered Institute of Taxation (CIOT) ...