CIOT: Low Incomes Tax Reform Group: Time for action on call charges
Campaigners for taxpayers on low incomes are calling for an end to the system which leads to them paying disproportionately high costs when phoning the taxman.
The telephone regulator, Ofcom, is consulting on whether to change the system for non-geographic telephone numbers such as 0800 and 0845 numbers. Currently HM Revenue and Customs (HMRC) require their customers to use 0845 numbers to contact them. Unlike 0800 numbers, which are free from landlines, these incur a charge. Costs from some mobile phones to an 0845 number are particularly high – up to 40p a minute.
John Andrews, Chairman of the Low Incomes Tax Reform Group (LITRG), an initiative of the Chartered Institute of Taxation (CIOT), said:
“Research has shown that many of HMRC’s lowest income customers use mobile phones rather than landlines. Yet most of the time, HMRC force their customers to use 0845 numbers to make contact with them. This is not discretionary contact; HMRC rules mean that you have to ring those numbers if you are to avoid significant financial penalties.
“For years LITRG has been campaigning for HMRC to adopt a telephone policy which does not involve the most vulnerable of their customers in disproportionate cost. Now the telephone regulator, Ofcom, looks set to force public sector bodies to adopt policies that give protection to the poorest.”
Ofcom’s consultation document recognises the confusion faced by consumers about what different phone numbers mean and how much calls cost. The document acknowledges that the higher costs faced by mobile phone users fall particularly on people on lower incomes, who are more likely to live in mobile-only households.
Ofcom proposes a simpler numbering system to make non-geographic numbers and their prices more intuitive, making 0800 numbers free from mobiles as well as landlines, and encouraging the use of 0345 (which is charged like the geographic 01/02 numbers and usually included in call bundles). This will mean changing the role of 0845 numbers.
John Andrews is calling for Ofcom’s proposals to be supported:
“I hope all bodies which have the interests of vulnerable customers of HMRC at heart will put in a supportive response.
“This presents a wonderful opportunity for the Government to ensure that those at the bottom of the income scale do not bear the costs of public service inefficiencies in a disproportionate way.”
Notes to editors
1. Ofcom issued their consultation paper on 16 December 2010. It can be found here: http://media.ofcom.org.uk/2010/12/16/tackling-consumer-confusion-over-call-charges/. The Ofcom consultation ends on 10 March 2011.
2. The Low Incomes Tax Reform Group (LITRG) is an initiative of the Chartered Institute of Taxation (CIOT) to give a voice to the unrepresented. Since 1998 LITRG has been working to improve the policy and processes of the tax, tax credits and associated welfare systems for the benefit of those on low incomes.
3. The CIOT is a charity and the leading professional body in the United Kingdom concerned solely with taxation. The CIOT’s primary purpose is to promote education and study of the administration and practice of taxation. One of the key aims is to achieve a better, more efficient, tax system for all affected by it – taxpayers, advisers and the authorities.
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George Crozier
External Relations Manager
D: +44 (0)20 7340 0569
M: +44 (0)7740 477374
The Chartered Institute of Taxation
www.tax.org.uk
Low Incomes Tax Reform Group
www.litrg.org.uk
The Association of Taxation Technicians
www.att.org.uk
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