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I will ask the Auditor General for Scotland about this. When the Scottish Government was in front of the committee last year, we heard that the service level agreement between the Scottish Government and HMRC was being renegotiated. We had been asking the Scottish Government to look at how the renegotiation could include discussion about releasing more of the data that we think should be available, some of which is fairly basic information about the tax gap and the extent to which fiscal drag is having an impact on tax returns. We were led to believe that that was within the scope of those renegotiations.

However, the current service level agreement looks broadly similar to the previous one. Looking at a fairly useful indicator, which is Mr Davies’s point, the fee paid by the Scottish Government to HMRC—which, let us bear in mind, is to support collecting data on £13 billion to £14 billion in tax—is £600,000. Maybe I am looking at this from the wrong end of the telescope, but if it is a question of paying a bit more to get better-quality data, I think that the view of this committee would be that it would be money well spent.

The sense I had from the evidence that we took last year from HMRC and the Scottish Government was that maybe the data that we are looking for is not available and that, no matter what the price, it could not be extracted from the system and disaggregated in the way that we think it ought to be. Do you have a view on that? I will ask Mr Davies first and then come to Mr Boyle.

Could you give us an example of that?

So, do not think that you can just jump on the M74 and pay less tax, Mr Simpson.

You mentioned the Scottish income tax board earlier. One of the things that resulted from our work last year was that it now produces minutes. They are not the most illuminating or comprehensive minutes that I have ever read—they are, basically, an outline of the agenda and a couple of bullet points beneath. Nonetheless, one set of those minutes describes the fact that the board is planning to be more strategic. Do you get any sense that that is the case?

We have gone over our time allocation. I think that some members of the committee still have questions, but we will follow them up in writing if you are willing to answer questions on that basis and if that is acceptable to the committee members who still have questions to put to you, including Graham Simpson.

Thank you for the evidence that you have given us this morning. It has been illuminating. We know that, at points, you have been challenged by the committee, and we thank you for your honesty in your responses to that. We have other work that we may need to do. In previous years, we have, in turn, invited the Scottish Government and HMRC to give evidence. The committee will consider how useful that would be on this occasion.

I thank Gareth Davies and Rebecca Mavin for their attendance and their evidence. Auditor General and Mark Taylor, I thank you as well. With that, I will draw the public part of this morning’s proceedings to a close.

I will move things swiftly along and invite Willie Coffey to ask some questions.

I have a very quick question, which relates to this thing about third-party data checks to get assurance. The report says:

“1.4 million records (27.0% of records analysed) could not be corroborated by comparison with the third-party data.”

That seems to me to be quite a high number. Do you have any concerns about that, Mr Davies?

Thank you very much, indeed. The committee will be particularly interested in looking at the methodological approaches and the implications of greater divergence between the income tax systems of Scotland and the rest of the UK. Perhaps I could begin by putting an important question to you.

On the one hand, you say that HMRC estimates are reasonable, but, in paragraph 1.21 of the NAO report, you identify areas of methodology in which there is a degree of what we could call woolliness. You say:

“HMRC does not fully understand the causes of the over-estimate in 2021-22 and any socioeconomic factors contributing to the over-estimate may be different in 2022-23.”

You say that there is a big reliance on sample data in the revenue estimates and that pay as you earn and self-assessment amounts that are apportioned to Scotland do

“not reflect the differing proportions of each type of taxpayer between Scotland and the rest of the UK.”

I wrote to you last year about that, and I might return to it.

You say that PAYE assessments include areas that are not subject to Scottish income tax variation, such as dividend payments, savings interest and so on, and you note that assumptions are the basis of HMRC’s estimates of PAYE liabilities. Those are all holes in the methodology that you have identified. How does that provide you with the comfort to be able to say that what we have before us is reasonable?

We have made the point in previous years that it is important for parliamentarians to understand what is going on out there, because, in the end, that guides policy decisions and decisions around the Scottish budget and where income tax is set. That is why we are especially interested. I would be interested to hear from you about what you would do differently if you were in the shoes of HMRC.