HMRC’s plans to cut the cost of its personal tax services by 34% over the next 5 years could lead to a drop in customer service quality, according to the Public Accounts Committee.

Customer service levels fell sharply in 2014/15 and early 2015/16 as a result of HMRC reducing their staff capacity and undermining the demand for telephone contact.

Average call waiting times tripled over this time period, resulting in a loss to taxpayers of up to £97 million. The situation improved towards the end of 2015 with the recruitment of 2,400 new staff.

It is currently unclear how the proposed cuts will affect this trend.

Taxpayers also spent 4 million hours waiting on calls in 2015-16 while receiving direct call charges when put on hold. This resulted in an extra £4 in costs to customers.

Meg Hillier MP, chair of the PAC, said:

“The prospect of HMRC making further cuts to spending on customer service will chill the blood of many taxpayers.

It is bad enough that people trying to pay their fair share of tax should have been kept waiting for so long.

But holding for HMRC’s helpline has hit them in the pocket too – a serious concern for those on low incomes and a dismal message to send to small businesses, the self-employed and anyone else simply seeking advice.”