Chamber and committees

We have noticed significant increases in your budget year on year over the past two or three years, and I imagine that it will be similar going forward.

It is the old argument about evasion versus avoidance, is it not?

Thank you very much for your contributions today. I do not know whether there are any final points that you want to make before we conclude. Is there anything that we have not touched on? Do you have any additional thoughts that have been stimulated by our questions?

Thank you for that opening statement, Aidan. It is hard to believe that it is almost a decade since the Revenue Scotland and Tax Powers Act 2014 was passed—I recall all the deliberations and discussions at that time.

It is also astonishing that this is the first time that you have been in front of the finance committee, but you have certainly made up for it with the tone of your annual accounts, which I and colleagues have been wading through. I have to say that it has all been very positive but obviously we have a number of questions for clarification. The answers to some of the questions that we will ask will be in your report, but it is important to get them on the public record.

At the end of your opening statement, you talked about staff. I notice that staff numbers have increased from 76 in 2021-22 to 83 in 2022-23. Can you tell us why that is?

But why is the figure only £6.7 million on 1 April in the year 2021-22, and more than £66 million on the same date a year later, when the net funds appear to be pretty similar? I am just wondering why that was.

“Pay and Benefits” seems to be the one where people are looking for the most improvement, surprisingly.

I am delighted to see how much you have been able to achieve with a fairly modest capital investment, given that Parliament spent more than £3 million updating its website to, in my view, a ropier system; however, we will not go into that, at this moment in time.

You are focusing on digitalisation. Do you have an issue with people who are not digitally included? I would not have thought that you would have a lot of that, given how house-buying operates now, but you must have some.

I am curious about your financial statement of cash flows in the devolved taxes account. At the bottom of page 26, there is mention of the

“analysis of changes in net funds”.

I am not really sure what that means. Can you explain that a wee bit? For example, on 31 March in tax year 2022-23, the figure was £61.935 million, but the following day it was £66.696 million. It is interesting that the net funds on 31 March in 2022-23 and in 2021-22 are about £61 million and £67 million, but there is a huge difference—of a factor of 10—between the net funds on 1 April in 2022-23 and those on the same date in 2021-22. Can you explain what those figures relate to and what they mean?

That is absolutely fine.

In the same document, note 1.4 about the devolved taxes account 2022-23 deals with the tax gap. I am interested in that, because it says:

“The theoretical liability represents the tax that would have been paid if all individuals and companies complied with both the letter of the law and Revenue Scotland’s interpretation of the intention of the Scottish Parliament in setting law (referred to as the spirit of the law).”

When the relevant bill was being put together a decade or so ago, the idea of the spirit of the law was very important in trying to avoid creating loopholes such as those that can occur in UK taxation. How much do you estimate the tax gap to be? It might be in the figures somewhere, but I had a wee look and could not find it in your accounts.

That is certainly very positive.

I have been looking at the corporate governance report. One of society’s big concerns these days is cybercrime, and I note that your accountability report indicates:

“During the course of the year, there were eight issues relating to minor data losses, which were reported and dealt with internally.”

It goes on to say that those losses

“were resolved quickly, and mitigations put in place.”

Has the potential occurrence of further and more serious data breaches set off alarm bells for Revenue Scotland? What is the organisation doing to ensure that that does not happen in the future?

He just got a mention as our accountant.