Headlines: February 14th, 2002

A new report from the National Audit Office reveals that while businesses are happy to use the internet for their employees’ tax affairs, individuals are much less willing to use new technology to submit their personal details to the taxman.The information comes in a study by the NAO into how the Inland Revenue is performing, as one of the Departments at the forefront of the drive to encourage people to do business with Government electronically.

The Inland Revenue’s electronic data interchange facility for Pay As You Earn tax has attracted 5,000 employers to use the service to send tax data to the Inland Revenue for some six million employees.

However, take up of the service whereby taxpayers can submit self assessment returns over the internet had been less than expected. The reasons include teething problems with the software, public concerns about security in using the internet, and a perception by users that there is no clear benefit in using the electronic service.

The NAO says that electronic submission of self-assessment forms means there is less likelihood of error creeping in, and that refunds can be issued quicker. Also, for the public purse, it is estimated that each electronic return costs three pounds less to process than a paper one.

The report says an important lesson for all e-public service providers is that e-services must be demonstrably useful to the public if they are to use them on any scale. It recommends the Inland Revenue makes clearer the benefits to customers of using electronic services, and also works on its customer-orientation. It concludes that the Revenue is unlikely to meet its target of 50 per cent take up of its electronic services by the end of 2005.