Taxman calls in debt collectors

HM Revenue & Customs is negotiating contracts with debt collection agencies for a nationwide six-month pilot project to speed up payments of income tax, corporation tax and VAT.

There are fears that the Government is taking the first steps towards outsourcing the tax system after HMRC announced plans to call in private debt collectors to chase missed payments.

As of March 2008, the Revenue was owed £25 billion - a mix of outstanding tax, interest payments, penalty charges and overpaid tax credits.

John Cassidy, tax investigations partner at national accountant PKF, said: "The big concern here is taxpayer confidentiality. What information are they going to give out about your or my personal tax affairs?"

The move forms part of a wider overhaul of procedures intended to boost the rate of tax collection amid public finance problems during the recession.

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