Teach more tax in schools, say campaigners

It forms part of a joint LITRG, Chartered Institute of Taxation (CIOT) and Association of Taxation Technicians (ATT) submission to the All-Party Parliamentary Group (APPG) on Financial Education for Young People’s inquiry into the barriers facing schools as they deliver financial education.¹

Kelly Sizer, Senior Technical Manager at LITRG, said:  

“Research shows that many people have insufficient understanding of tax. This can lead to non-compliance, tax debt and penalties, which can in turn impact on people’s general wellbeing.²

“While tax is complex, it is relatively easy to introduce some key concepts to children of school age, starting with a basic foundation at primary level which can be developed as they progress their education. This can help to build future compliance with the tax system.  

“However, at present, tax does not appear anywhere in England’s national curriculum in its own right.³ Until tax is given more prominence within the national curriculum, it is hard to see how schools will commit the necessary resources to educate their students on this important matter.” 

The submission suggests to the APPG that a co-ordinating strategy is needed which matches potential volunteers from the tax profession to schools to help deliver lessons. Professional bodies such as CIOT and ATT could promote such a scheme to their members, to develop a bank of willing volunteers for schools to call upon.  

Kelly Sizer said:

“Resources are already out there to support teaching tax in school, such as HMRC’s Tax Facts and Junior Tax Facts⁴, but we understand that some teachers might find the subject falls outside of their comfort zone. This is where qualified tax professionals can help, adding their skillset to those of the teachers to deliver lessons.  

“We know that some tax professionals already support local schools in delivering financial education on an ad hoc basis, but a nationwide scheme to pair up professionals with schools could help more to get involved.”

Notes for editors

1. Submission made by the Chartered Institute of Taxation, its Low Incomes Tax Reform Group and sister charity, the Association of Taxation Technicians. See https://www.litrg.org.uk/latest-news/submissions/220609-appg-financial-education-young-people-inquiry-barriers-facing-schools.
    

2. There is plenty of research confirming people’s lack of tax knowledge. For example, HMRC research suggests that 54 per cent of people who have earned income from the sharing economy (which includes those working in the ‘gig economy’) do not realise it is taxable. [HMRC report 453, 5 May 2017, ‘Research on the Sharing Economy’: https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/658728/HMRC_Report_453_Sharing_Economy.pdf]

   Further examples can be seen in a 2019 Deloitte LLP report which found that 76 per cent of people surveyed felt that tax should feature more often in schools. It also noted that there is a greater gap in younger people’s knowledge than in older age groups. When asked a series of everyday personal tax questions, out of a possible score of 30, the average respondent scored 10.6, but those between 18 and 24 scored just 6.9.  [‘The Tax Education Gap: Is it Time to Talk?’, September 2019, Deloitte LLP. A summary of key findings and the full report are available at: https://www2.deloitte.com/uk/en/pages/tax/articles/tax-education-gap.html] 

   In relation to devolved taxes, the CIOT has also carried out three surveys of the Scottish public, using the Diffley Partnership, to understand levels of awareness and understanding of the devolved tax system (in 2018, 2019 and March 2021). The 2021 poll found that one third of those surveyed were unaware that the Scottish Parliament had made changes to the tax system since 2015. When asked whether Scots need better information on how taxes are decided in Scotland, 83 per cent of respondents said they did. The Scottish Government has attempted to start addressing this issue – for example, with a short animated video on Scottish taxes. 
    

3. A passing reference only is made in one of a list of topics in the subject of ‘Citizenship’ where, at Key stage 4, it is noted that students should be taught about ‘how public money is raised and spent’. See https://www.gov.uk/government/publications/national-curriculum-in-england-secondary-curriculum (page 84 of the PDF).
    
4. Tax Facts is aimed at secondary school children, whereas Junior Tax Facts is aimed at primary level. See https://www.tes.com/teaching-resource/hmrc-tax-facts-12109552 and https://www.tes.com/teaching-resource/hmrc-junior-tax-facts-12106669 respectively.
    

5. The LITRG is an initiative of the Chartered Institute of Taxation (CIOT) to give a voice to the unrepresented. Since 1998, LITRG has been working to improve the policy and processes of the tax, tax credits and associated welfare systems for the benefit of those on low incomes.   

   The CIOT is the leading professional body in the United Kingdom concerned solely with taxation. The CIOT is an educational charity, promoting education and study of the administration and practice of taxation. One of our key aims is to work for a better, more efficient, tax system for all affected by it – taxpayers, their advisers and the authorities. The CIOT’s work covers all aspects of taxation, including direct and indirect taxes and duties. The CIOT’s 19,000 members have the practising title of ‘Chartered Tax Adviser’ and the designatory letters ‘CTA’, to represent the leading tax qualification. 

Hamant Verma