Chancellor sets literacy target for taxpayers

Published on 6 December 2006

With the tax, tax credits and benefits systems growing increasingly complex, the Chancellor’s programmes to enhance adult literacy and financial inclusion could not have come at a better time for taxpayers and tax credit claimants.

In his pre-Budget report this afternoon, the Chancellor set out the Government’s aspirations to achieve greater literacy throughout the United Kingdom and this followed the Prime Minister acknowledging that existing levels of adult literacy were inadequate.

LITRG has long campaigned for HMRC to recognise this fact when designing forms and placing burdens on individuals to check for HMRC mistakes in relation to their tax and tax credit affairs.

It is a great pity that HMRC do not overtly acknowledge that their way of constructing claims, awards, returns etc. discriminates against those with low literacy levels. This is especially so at a time when staff reductions are inevitably leading to cuts in face to face help.

The Treasury press release refers to “building a fairer society”. It would help that cause if the responsibility for determining whether it was reasonable for someone with a low literacy level to spot an HMRC mistake was taken away from HMRC and given to an independent tribunal.

If such a system had been in place for the last three years, then many of those tax credits claimants, currently with huge overpayments due to HMRC error, would have had them written off.

We wish the Chancellor’s literacy and financial inclusion initiatives well, and hope that they will in time help those bewildered by his systems to understand better their rights and obligations under them.

Rates and allowances

For a table with the complete updated rates and thresholds for 2007-08, go to the HMRC press release. There is a small change trailed from April 2009 when entitlement to child benefit comes in after the 29th week of pregnancy, which will provide a further £200 of tax free payment.

(06-12-2006)

Contact: Robin Williamson (Tel: 0844 579 6700 Fax 0844 579 6701)