Data Protection concerns: EMA evidence for House of Commons for Finance Bill 2016

On Monday 4 July we submitted evidence to the House of Commons Public Bill Committee responsible for scrutinizing the Finance Bill 2016.

New proposed legislation has been incorporated into the Finance Bill 2016 that will give HMRC the power to gather payments data from payment service providers and online “business intermediaries” on their customers – both businesses and consumers. HMRC want to increase tax revenue by gathering data to aid in the capturing of unreported income (the “hidden economy”), a goal that the EMA supports.  

However, this aim should not be to the detriment of consumers’ rights to the protection of their data. The proposals as set out in Clause 164 of the Finance Bill 2016 give rise to broader powers than those set out in the explanatory notes, resulting in a law that is heavily disproportionate in relation to the intended result. The new powers are drafted in such a way as to give the impression that HMRC will be making targeted requests for data from data-holders on an ad-hoc basis. However, in reality they will require data holders to report all relevant data on a quarterly basis, potentially moving to monthly basis in the near future, and they may require them to report on all accounts, regardless as to whether they are consumer or business accounts. In addition to this, there are no in-built safeguards on how the data will be used in future.

The data collection powers being proposed are not sufficiently limited: the scope of what data can be collected, and the definition of whose data can be collected are broad, collection will be periodic – annually or even monthly, and the data, once collected, may be used for any purpose. These proposed powers are compounded by the recent introduction of the UK government’s draft Digital Economy Bill, which will allow HMRC to share data with other bodies.

Below we have set out our concerns in further detail.

Evidence for Finance Bill 2016 Clause 164. Electronic Money Association

The EMA responded to a previous consultation: