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Reform UK’s tax pledges could cost the Treasury billions of pounds in lost revenue and it remains unclear how they would be paid for, according to audit, tax and business advisory firm Blick Rothenberg.
Tom Goddard, an assistant manager at the firm, said Robert Jenrick, Reform UK’s shadow chancellor, had pledged to scrap tax on overtime payments, cut national insurance for businesses that “hire British workers”, lower the rate of VAT for self-employed individuals, and give every taxpayer a £30 tax credit if they are kept on the phone to HMRC for more than 30 minutes.
“However, there is little detail on how these measures would work, how much they would cost to be implemented, and how the resulting loss in tax revenue would be offset,” he said. “Although Reform UK has suggested welfare spending cuts could fund these measures in part, detailed fiscal analysis of both costs and savings would be needed to actually assess if this is feasible.”
The overtime pledge builds on a policy Nigel Farage set out in May, when the Reform UK leader promised to lift income tax from overtime pay for workers earning under £75,000 at a stated cost of around £5bn a year.
Goddard said the three headline measures would each strike at one of the UK’s largest sources of revenue. “Scrapping income tax on overtime, lowering national insurance contributions, and decreasing VAT would impact each of the UK’s ‘big three’ tax generators,” he said. “Consecutive governments have ruled out making changes to these three taxes as they constitute too large a portion of the country’s revenue, around 75% for the period from August 2025 to July 2026. Lowering the rates of the big three, even if only under specific circumstances, could cost the country billions in tax revenue which would need to be accounted for elsewhere.”
The proposal to reduce VAT for self-employed workers drew particular criticism. Goddard said it “could also create both fairness and complexity issues”, pointing out that VAT is generally levied on goods and services rather than on an individual’s employment status.
“Creating a separate VAT regime for one category of worker could introduce new administrative burdens, further costs and increase opportunities for tax avoidance through reclassification of employment status,” he said.
The firm was equally sceptical of the plan to compensate taxpayers for long waits on HMRC’s helplines, an issue that has dogged the tax authority for years, with callers reporting waits of up to 70 minutes ahead of filing deadlines.
Goddard said a new tax credit scheme based on call times “could cost the country millions in implementation before the first qualifying call”, because it would require robust mechanisms to verify eligibility, process claims, prevent fraud and administer payments.
He then set out what the credit itself might cost. “By HMRC’s own statistics, there were 24 million calls for the year in 2025, of these, 50% had a waiting time of 10 minutes,” he said. “Taking a conservative approach, 15% of total calls may have had a call time of longer than 30 minutes. This amounts to 3.6 million calls, each of which would be entitled to a £30 tax credit, therefore resulting in further cost to the government of £108m.”
HMRC’s own performance data for the 2025 to 2026 year shows the department had received just over 24 million calls in the year to January, with an average speed of answer of 13 minutes 27 seconds and 51.4% of callers waiting more than 10 minutes.
Goddard also warned that the design of the scheme could backfire. “It could be argued that linking compensation directly to time spent on a call risk encouraging individuals to remain on the line unnecessarily or to repeatedly contact HMRC in pursuit of a credit,” he said. “Even if safeguards could be introduced, doing so would add further complexity to what is intended as a remedy for long wait times.”
The intervention comes as Reform UK courts the business community, with Vodafone, Heathrow and JCB among the companies attending the party’s conference in Birmingham this week, where it is staging its first dedicated business day.
Goddard said the UK’s tax system had “serious problems” that needed to be addressed “in a proactive and comprehensive measure”. He added: “However, adding additional complexities to the system is unlikely to be the answer.”
