Computer concerns over new land tax

Published on 21/10/2012 00:00

THE body lined up to play a key role in Scottish tax collection may not be ready for the task, former Labour leader Iain Gray has warned, after a multi-
million pound IT bungle.

The heads of Registers of Scotland (RoS), the Edinburgh-based organisation that will work with Revenue Scotland to collect the new Scottish tax to replace stamp duty, have been called before MSPs on Holyrood’s public audit committee this week to allay concerns.

A damning watchdog’s report this year found it paid out £112 million to BT for an information and communications technology (ICT) contract that was originally valued at £66m. This led to an embarrassing £6.7m write-off for the body after two projects were cancelled.

But RoS insists it has been assisting the collection of stamp duty for four years and is up to the job. Finance secretary John Swinney announced this year that the body, responsible for compiling and maintaining property and legal records, will partner Revenue Scotland in collecting the new land and buildings transaction tax. This will replace stamp duty, which Holyrood will take control of when the Scotland Act comes into effect in 2015.

RoS keeper Sheenagh Adams and deputy keeper Catriona Hardman will appear before the Scottish Parliament committee on Wednesday. Convener Gray, said: “If they’re going to successfully deliver this Revenue Scotland role, they’re going to need ICT systems which are fit for purpose and the past experience hasn’t been a particularly positive one.

“Revenue Scotland will levy initially limited taxes, like the land value tax, but were Scotland to become independent or move towards something closer to full fiscal autonomy, then Revenue Scotland would be the body you would look to to collect all taxation.

“So it’s pretty crucial they can give us the assurances – both, that they’ve got processes in place to make sure their ICT contracts are fit for purpose.”

Many public bodies do not have the in-house expertise to negotiate complex ICT contracts, according to Audit Scotland, and government support is often limited.

An RoS spokeswoman said it has been operating the online collection of stamp duty tax for HMRC since 2008. She added: “This … makes us the ideal organisation for the collection of land and buildings transaction tax on behalf of Revenue Scotland.”