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Massive shake-up to make HMRC "fit for future"

The UK's tax authority, HMRC, is to be radically reorganised as part of its on-going modernisation programme.

Over the next five years, 13 new HMRC regional centres will open, replacing most of the 170 separate tax offices currently operating in the UK. The first will open in 2016-17, with others following between 2017 and 2021.

HMRC expects the majority of its 58,000 staff to be able to move from their current offices to a regional centre, and is phasing the moves over ten years to minimise redundancies. However, it has said that it will aim to have fewer staff in the future.

The 13 new regional centres will be in: Newcastle, Manchester, Liverpool, Leeds, Nottingham, Birmingham, Cardiff, Belfast, Glasgow, Edinburgh, Bristol, Stratford and Croydon.

According to HMRC, the changes will enable HMRC "to give customers the modern services they expect at a lower cost to the taxpayer". The plan is expected to generate estate savings of £100 million a year by 2025.

Lin Homer, HMRC's Chief Executive, said: 

"HMRC has too many expensive, isolated and outdated offices. This makes it difficult for us to collaborate, modernise our ways of working, and make the changes we need to transform our service to customers and clamp down further on the minority who try to cheat the system."
The new regional centres will "bring our staff together in more modern and cost-effective buildings in areas with lower rents," said Homer. "They will also make a big contribution to the cities where they are based, providing high-quality, skilled jobs and supporting the Government's commitment for a national recovery that benefits all parts of the UK."

Stephen Herring, Head of Taxation at the IoD said: 

"The announcement of another HMRC restructure will be met with predictable concern that fewer people answering calls could result in lower revenue. But that simply need not be the case. The number of employees should not be seen as a proxy for HMRC's effectiveness as a tax collector. The United States' Internal Revenue Service serves a population five times the size of the UK, but has only 60% more staff."

He added: "Of course, the easiest way to make the process of collecting tax as easy and painless as possible is to make sure taxes are as simple as they can be. HMRC's job could be made a lot easier if the Government radically simplified our hefty tax code."

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