How HMRC could scupper covid-19 contact tracing

Fears about the security of the NHS contact tracing app and the use of its data by HMRC could lead to it being shunned by individuals. HMRC has shown in recent years how valuable this information can be, demonstrating the need for legislative protection to be put in place.

HMRC is not particularly well known for its technological prowess, with projects such as Making Tax Digital subject to various delays over the last few years. However, one innovation that has been a success is its award-winning software Connect, which helps it process billions of lines of data and identify potential tax avoiders and evaders. 

Connect has been a key tool in HMRC’s armoury, generating billions of pounds of additional revenue for the Exchequer since its introduction in 2010. It’s estimated at least ￡3 billion of extra tax has been recovered in the period from 2010 to 2018.  

HMRC has proved that it is particularly adept at processing large volumes of data to open tax enquiries. Hence, some individuals will be reticent to hand over more significant personal data, as currently planned with the centralised contact tracing app.

HMRC would no doubt find the data valuable if it could track an individual’s whereabouts, as it already seeks to do so in some circumstances. For example, an area of particular focus for HMRC is individuals with an international element to their affairs. Individuals who are not tax resident in the UK but spend time here can be subject to quite detailed scrutiny of their affairs, in particular in relation to how many days they spend in the UK. There can be requests to see mobile phone records, credit card bills and flight logs.

The case could be made that it is right that HMRC has access to this data if it helps to close the net on tax avoidance and evasion. An immediate risk in providing HMRC with the data is if some individuals are inadvertently brought into the spotlight and subject to enquiries when they shouldn’t be. A more significant concern however is scope creep; where is the line drawn and do we trust government bodies to make such a judgement?

Assurances have been given by the government that the NHS contact tracing app being developed will use its collected data for the sole purpose of limiting the spread of coronavirus. Nevertheless, demands have been made by The Joint Humans Rights Committee for Matt Hancock to bring a bill before Parliament which enshrines in law the promised protections.  

Ultimately, until such legislation is introduced and the public has confidence that its data will be used as promised, the app may have poor take-up. The government may be a victim of its own success as HMRC has highlighted it can process individual’s data so effectively for other means.

As seen in;

https://www.rsmuk.com/blog/how-hmrc-could-scupper-coronavirus-contact-tracing/

https://www.telegraph.co.uk/business/2020/05/28/tax-snooping-fears-could-hit-coronavirus-app-downloads/ (don't know why but the quotes have attributed to my esteemed colleague George rather than me)