Chief Executive of the British Bankers’ Association, Anthony Browne, has said he has “real concerns” that new powers granted to H M Revenue & Customs (HMRC), allowing the department to take money directly from peoples bank accounts, breach human rights laws.
His arguments, outlined in a letter sent to Chancellor George Osborne, are the latest development in the controversial proposal that has triggered ferocious opposition from financiers, charities and MPs.
Under the new system, known as the direct recovery of debts, HMRC will be able to take cash directly from a current account, joint account or ISA to settle unpaid tax bills.
In the past the department would have had to seek the court’s approval before they could withdraw the funds, but now they will be able to do it without the court’s consent.
It is estimated that around 17,000 people a year, owing on average around £5,800, will have money seized under the proposed new powers.
But Mr Browne raised fears that the proposals might contravene the Human Rights Act.
“We have specific concerns about how the proposals would interplay with the Act,” he said in his letter. “We are not persuaded that the rights of those affected by the proposals, including the vulnerable, family members and those erroneously affected, are sufficiently protected.”
If approved HMRC say the policy will only target those with more than £1,000 of unpaid tax and those who have been contacted at least four times.
But the BBA fears the policy will affect a significant number of unintentionally non-compliant, vulnerable taxpayers, such as the elderly.
A Treasury spokesperson, said: “There is no question of those who genuinely cannot pay being affected – the safety of vulnerable customers is a priority and the Government is proposing robust safeguards.”