UK tax policymaking – is it fit for purpose?

In 2005 the Inland Revenue and HM Customs & Excise merged to form HM Revenue & Customs (HMRC). As part of the merger the policy functions of those former departments moved to HM Treasury (HMT). HMT became responsible for ‘strategy and tax policy development’ with HMRC being responsible for ‘policy maintenance’. This re-allocation of responsibilities was combined with closer working between HMRC and HMT with both being co-located in the landmark Great George Street building (HMRC on the Whitehall side and HMT on the Horse Guards side).

This new structure was put in place by Gordon Brown and Gus O’Donnell (a very senior civil servant) and possibly it was a power grab by HMT and to enhance Gordon Brown’s powerbase. Even if it was it seemed to work pretty well to begin with. Meeting invitations would often allow you to use either entrance/exit both HMRC...