Farmers fear plans to digitalise tax matters due to poor internet connections
Plans to digitise all tax-related accounting is due to be phased in from 2018 onwards, but rural businesses and farmers have criticised the plans.
Farmers have said the HM Revenue and Customs (HMRC) initiative to make tax digital will be difficult for businesses in the countryside without fast and reliable broadband.
They have also warned that poor digital connectivity in rural areas and no plan from HMRC to undertake comprehensive user testing of the new system could throw the rural economy into chaos.
The current rural broadband roll-out is 'not sufficient' to meet the needs of most farmers, according to a report from October.
The government has said it is committed to making the UK the best connected country in the world but farmers are already being held back by poor connections.
The report, published by the NFU, said it was vital for connections to be improved.
There are social, economic and environmental benefits' of connecting the final 5% of those without broadband, especially for the delivery of a sustainable and productive agricultural sector, the report states.
'Government must look at the whole picture'
The CLA, which represents farmers and rural businesses, said it is 'vitally important' to help everyone achieve tax compliance.
“We support new technology which aims to make life simpler for businesses but the government must look at the whole picture before making tax digital," CLA President Ross Murray said.
“Rollout of superfast rural broadband has been too slow and the government’s Universal Service Obligation (USO) of 10Mbps by 2020 is not guaranteed to be met.
“Current broadband technology in the UK means download speeds are faster than upload speeds, so the government must reassure businesses they will not be unfairly penalised as a result of poor connectivity when trying to complete and submit tax information online.”
Mr Murray added that without the right broadband infrastructure in place or by ensuring the new digital system is fully tested in advance, rural businesses could suffer and HMRC could experience similar problems to the Rural Payments Agency (RPA) when it digitised the Basic Payment System for farmers.
He said: “It is crucial in view of previous government digital systems failures such as the RPA that HMRC should reflect on the lessons learned from that project to avoid a serious breakdown in the system which would cause yet more chaos for the rural economy.”
