CIOT has urged caution over proposals from HMRC to increase the amount of data it puts in the public domain or releases to Credit Reference Agencies (CRAs).
The institute's comments are contained in its response to HMRC's consultation, Sharing and publishing data for public benefit which examines how the department can make more information available in the light of the UK's commitment to the G8's Open Data Charter, which presumes that the data held by governments will be publicly available unless there is good reason to withhold it.
In its consultation briefing, HMRC says it has identified three categories of information which it believes can be more widely shared without compromising the core principle of taxpayer confidentiality. These are aggregated and anonymised tax data for use for the purposes of research or policy development; the release of basic non-financial VAT registration data; and sharing more detailed VAT registration data on a more restricted and controlled basis for specific purposes, such as credit referencing.
In response, CIOT has stressed that taxpayer confidentiality, and the avoidance of any potential damage caused by data release, must take precedence over any benefits of 'Open Data'.
CIOT president Stephen Coleclough said: 'These proposals seek to use personal data in an anonymised or aggregated way, but in reality, this is extremely difficult without exposing individuals to identification with their personal data. Indeed we are concerned at how much detailed information is already published by HMRC, including for example, that parents of only five 19 year olds in the Orkneys are in receipt of child benefit.'
CIOT says it is in favour of publishing VAT registration data as this would help customers and enable businesses involved in cross-border transactions to validate their supplier and could help prevent fraud.
However, the institute says it sees 'no reason' for the provision of additional information to CRAs, arguing that no clear benefits have been identified, while there are concerns over lack of data control. It also claims that publication to selected bodies could lead to a potential breach of data protection laws and a competitive edge being gained over other businesses who may not have access to the published data.
Coleclough said: 'We do not object, in principle, to the publication and release of aggregate and anonymised data. However, we are concerned that even the strictest safeguards and deterrents may not be sufficient to prevent the misuse of data and the identification of individuals - for example by being cross referenced with other data. This is dangerous territory and these proposals must progress with significant caution and sustained consultation because once the data genie is out of the bottle, it cannot be put back.'
