By Jonathan Davies
The Treasury has loosened plans to allow HM Revenues & Customs (HMRC) to retrieve tax debts directly from people's bank accounts.
Under the plans announced by the Chancellor George Osborne in the Budget, HMRC would have been able to collect debts from anyone who owed more than £1,000, subject to certain safeguards.
But under the revised plans, taxpayers will be given more time to appeal. The initial appeal period was 14 days, but it is now 30 days. The changes come after heavy criticism from banks, MPs and debt charities.
"It's a good day for taxpayer confidentiality," says Chas Roy-Chowdhury, head of taxation at the Association of Chartered Certified Accountants (ACCA).
"While ACCA would have preferred the power were not being proposed at all, we consider where we are today is light years better than what was originally being proposed."
In announcing the changes, the Treasury stressed that these powers would only be used by HMRC in cases where the debtors have consistently refused to cooperate or pay.
"The Direct Recovery of Debts (DRD), announced by the chancellor in the 2014 Budget, is an important tool in helping to level the playing field between those who pay what they owe, when they owe it, and those who do not," said the Financial Secretary to the Treasury, David Gauke.
"Only debtors who have received this face-to-face visit and are not identified as vulnerable, have sufficient money in the bank and have still refused to settle their debts, or enter an appropriate Time to Pay arrangement, will be considered for debt recovery through DRD," he added.
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