No one has said anything about it because its a nonstarter. The idea was touted by the department (HMRC) rather than by politicians and the Tories (yes, those that are in government) shot the concept down in flames. Why you have even picked this up is bizarre, get off your hobby horse and stop throwing up straw men!

BoredofLabourrubbish is right (not that I like saying that), this isn’t a coallition idea.

The way I heard it on Moneybox, the TPA didn’t like it either, so you’re in good company.

Its good to see that there’s still a good career for swivel-eyed lunatics in the senior civil service. That’s at least one tradition preserved.

Mr Eugenides and Worstall have already mentioned this in suitably sweary fashion.

I can’t see how this would make anyone’s life any easier, even if it were a good idea in the first place.

Is there anyone anywhere who has a good word to say for this scheme? Left, Right, swivel-eyed, marxist, anyone at all?

Thought not. Won’t happen.

It is interesting that some people are saying that this policy is “not Conservative” when before the election the Telegraph said that the Conservatives were planning to implement it.

The Conservatives are working on a pilot for a new automated bank-based system that would remove the responsibility of deducting and paying income tax from employers. The new system could save businesses up to £5.5bn according to the Tories and increase revenues to the Exchequer of £1bn., according to the Tories election hopefuls.

Rather than leaving employers to process different tax codes and pay income tax for employees, the new system would automatically deduct income tax and national insurance contributions directly from an employee’s gross pay as it is paid into their bank account.

If the Tories were so much against this as is being suggested, then why did they issue a briefing paper about it in February?

“Is there anyone anywhere who has a good word to say for this scheme?”

I was half tempted to play devil’s advocate, but frankly this one is too difficult.

This is simply in the tradition of conservatives trying to outdo leftwingers on “stereotypical” leftwing duties: Disraeli supporting the Corn Law protests; Nixon chumming it up to Mao; Cameron utilising an economic model of democratic central control. Leftwingers should respond in kind. Workers of all countries put on your cravats.

This idea is dead, dead as in dodo.

As soon as the Cabinet (or anyone rational to the extent that the two groups don’t overlap) realises that this means funnelling the entire payroll for the country through the hands of Mark Serwotka and the PCS union then the idea is simply not going to go anywhere other than the round filing cabinet under the desk.

Or, as I said when it first hit the papers.

“Fuck off. No, really, fuck right off.”

Richard @6,

Although that would have been a very bad idea also, putting power in the hands of banks rather than employers and employees (can’t see any problems with the banks can we?), it is a different bad idea than the HMRC proposal that they deal with all pay. I suspect if there was any truth to that idea (and it didn’t make the manifesto or the like) a combination of the Conservative right wing and the Liberal Democrats have now made sure it is a non-starter.

To be honest, from the point of view of HMRC trying to simplify their operation, this was a sensible proposal (hang on, that was almost a defence – although only if you believe HMRC are somehow incapable of suggesting that tax codes are simplified). It should, however, have been made to government as a recommendation, and immediately scrapped as stupid there, rather than publically set up for a fall .

It’s hard to defend this one…

But in the spirit of Watchman’s almost a defence..

There is millions spent each year by SMEs calculating payroll sums for their staff.

Every company has to shell X £00′s for Sage Software or the like to help them…. loads of man-hours by the book-keepers / payroll staff.

Surely (wicked grin), the HMRC’s own computer software + staff hours would add upo to much less that everybody on the DIY route.

Ergo – a net saving to UK Plc if the HMRC did it for us.

..Oh dear, the downside of that would be a big hit on payroll software companies…. and alot of book-keepers/payrol staff out of work.

Perhaps that is less of an ‘almost defence’ than it sounded at the start…

I’m no fan of Tories, but this will never fly on the grounds that it is the definition of “Big Government” the operation would make the NHS look like a minnow, it’s most likely a brain storming idea from a civil servant, that was picked up jut to make news. This sounds like an article from the Daily Mail.

> the operation would make the NHS look like a minnow

You sure?
Don’t the HMRC already have software that calculates payroll stuff….and it’s less ‘front line intensive’ than nursing and etc.

That new fangled Interweb thing handles all the client-facing stuff:
a) A web site where companies log in to say what their gross salary they will send to the HMRC will be, per staff.
b)a website where joe public can login and see what the tax deductions were calculated at.

If they did it right…(cough), no need for anything but a tiny call centre – as the range of questions is TINY compared to say NHS Direct.

They could probably sub-contract the whole thing to Sage Software, who’s product is market leader in the UK, and is probably used to calculate most people’s payrol anyway!

But..then you’d need an ombudsman…and a complaints system… and managers to manage the overseers of the guys who do the software…and a diversity officer… and health and safety of the websites…

Today, if a payroll system is abused or breaks down, the consequences are limited to that company’s staff. With this absurd plan floated by HMRC – which itself doesn’t have the best of records, let alone the rest of government – every worker in the country is exposed.

I forgot to add this link – Disability rights activist chains self to tax office desk.

@14 ukliberty: “Today, if a payroll system is abused or breaks down, the consequences are limited to that company’s staff.”

That argument suffices. Payroll is a basic function of management; payment of workers is essential so if the system breaks, you adjust; it may come down to exchanging brown envelopes in a car park.

a bit late – but just read today that:

“It would also save employers some £500 million a year in admin costs, HMRC estimated.”

And also this:

“John Whiting, tax policy director at the Chartered Institute of Taxation (CIOT), doubted whether the paper in its entirety was feasible, but detected merit in some of the proposals.

Mr Whiting said:

“You can see the idea of HMRC effectively running the whole of the payroll system is a non-runner, quite frankly.

“But we should talk about how some of the more desirable aspects of the paper – the centralisation of information by the Revenue, the axing of paperwork and the reduction of the burden on employers – could be brought forward. If they had been in place, the problems we are now seeing in tax coding would probably not have happened.”

“It would also save employers some £500 million a year in admin costs, HMRC estimated.”

There are 2.1m business registered for VAT and/or PAYE (ONS).

Admin about £238 a year per business, then.