by Elliot Keck, head of campaigns
The state doesn’t have many friends at the moment. Everyone has a bone to pick with it. Whether it’s Londoners sick of seeing TfL turn a blind eye to fare-evasion, learners becoming impatient with the lack of driving test availability, elderly patients waiting for a hip operation, or victims of crime facing drawn out court cases due to the backlog, positive interactions with the state are becoming a rarity.
But most of the state failures can be attributed to incompetence, indolence and indifference as opposed to malice. I say most because there is one arm of the state for which the word malicious is entirely appropriate. And that’s His Majesty’s Revenue and Customs.
For despite this body’s illustrious, regal name - suggesting a certain grace and dignity - this is actually a wretched organisation staffed by petty, grasping pen pushers determined to squeeze every penny out of taxpayers that they possibly can. Their responsibilities are simple. Among other things they are responsible for safeguarding the flow of money to the Exchequer through their collection, compliance and enforcement activities. Making sure that the tax that should be paid is being paid, to put it succinctly.
That’s all very well. It goes without saying that tax evasion is a crime, and a serious one at that. It’s absolutely right that a body exists to track this cash down - every penny unpaid as a result of deliberate tax evasion is a penny saved by a criminal and paid for by a law-abiding taxpayer.
Only, with tax evasion as low as it is (equivalent to about 0.7 per cent of all taxes owed), HMRC seem to be spending more time hunting down people for honest mistakes (and occasionally hunting down people who have done nothing wrong whatsoever) than they are targeting genuine criminals fleecing the state and taxpayers.
This is an appalling development. As a result of decades of failed tax policy, the UK now has one of the most complicated tax systems in the world, at more than 21,000 pages in length. Inheritance tax in particular is painfully complicated, making up more than 1,000 pages for just one tax, which raises just £8.2 billion.
Now HMRC is not to blame for this complexity - this is the fault of countless decisions by politicians seeking carve outs for special interest groups while hiking up rates to use as bribes to the electorate. But it absolutely is up to HMRC how it chooses to investigate the non-payment or under-payment of tax. And here it covers itself in shame. Take the revelations just recently that HMRC disputed the property valuations of 7,500 properties last year, based on its belief that a property had been undervalued. This is a deliberate choice to go after grieving families because of a disagreement with the executors of the estate And what was the success rate? In only half of cases did the Valuation Office Agency decide to proceed with an investigation. And of these only half actually resulted in an increased property value. This is not evidence of a targeted, forensic approach with careful consideration about when to launch a dispute. Instead it’s a scattergun, haphazard approach that targets as many families as possible with complete disregard for their emotional, mental and financial states.
Or another story, this time that the number of inheritance tax investigations launched by HMRC increased by 31 per cent in the 12 months to April 2025. Again, this is a deliberate choice by HMRC to focus its firepower on grieving families.
This is almost gratuitously cruel. Inheritance tax has a simply mind boggling range of exemptions and allowances. Just to give one example, known as the “7 year rule”, or better termed the tax on misfortune. This means that no tax is due on any gifts you give if you live for 7 years after giving them. If you die in less than seven years your estate is subject to tax, depending on how long you live. Below is the taper relief that is applied.
Do HMRC take a forgiving attitude towards taxpayers who may have fallen foul of the rule? No, far from it. They instead use every dirty trick in the book to squeeze every last penny they can. If you want to hear how brutal they can be, listen to a recent episode of our podcast, a nation of taxpayers, in which Gabrielle O’Donovan explains her multi-year saga trying to clear her name with HMRC after it accused her of tax evasion based on the non-payment of tobacco duties, all for a shipment that she never ordered, paid for or received.
Of course, the real problem is inheritance tax itself. But let’s not lose sight of just how nasty and capricious the enforcers of this tax are.