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Page last updated at 17:49 GMT, Friday, 17 September 2010 18:49 UK

Uncertainty in tax concession

Dave Hartnett, HMRC
BBC Radio 4's Money Box
Saturday, 18 September 2010 at 1204 BST on Radio 4 and Online

After another week of hostile headlines, HMRC has scrapped plans to charge interest on money it claws back from taxpayers who owe more than £2,000.

The move has been ordered by Treasury ministers following public anger at the widespread mistakes - highlighted by Money Box last week, which have led to many people paying the wrong amount of tax.

HMRC calculates that 1.4 million people owe them about £2bn - or £1,428 each on average. In all, official figures just out show that the UK's tax gap created through evasion, avoidance and collecting problems has risen by £4bn in 2008/09 to £42bn.

The programme talks to John Whiting, Tax Policy Director at the Chartered Institute of Taxation and to Matthew Sinclair of the Taxpayers' Alliance, about these developments and also about controversial proposals that HMRC get increased powers. These would ensure that tax is deducted directly from workers' pay packets before salaries reach their bank accounts.

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Beneficial Claims

Earlier this year a Money Box investigation raised serious concerns about the firm Beneficial Claims which had assured customers it could write off their credit card debts.

Since then some of the firm's clients have contacted Money Box to say the firm had advised them to stop making payments to their creditors and this had got them even deeper into debt.

They were then told after months of waiting their debts were enforceable after all, and they should start paying their lenders again. And the refunds they have demanded from Beneficial, now called We Fight Any Claim, have not yet not arrived.

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Financial Ombudsman complaints

The number of complaints made about financial firms to the Financial Ombudsman Service (FOS) has risen in the first half of the year. However, the FOS sided with the consumer in a smaller proportion of resolved cases than previously. It received 84,212 new complaints, with more than half about five major banks.

Adam Philipps, chairman of the Financial Services Consumer Panel and Eric Leenders executive director at the British Bankers Association talk to the programme.

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BBC Radio 4's Money Box: Saturday 18 September at 1204 BST and Sunday 19 September at 2102 BST.



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