Around 16 million individuals and businesses calling the taxman for help face hanging on the line for more than five minutes, officials have said.

HM Revenue and Customs (HMRC) was attacked for its "low ambitions" after revealing it expects about 20% of the 80 million calls to their hotlines – many of which are 0845 numbers – will take longer than five minutes to answer.

Labour's Margaret Hodge, who chairs the Public Accounts Committee, said the industry norm was to take eight out of 10 calls within 20 seconds and dismissed the target as a "disappointment".

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HMRC was condemned last year for costing callers £136 mil-lion a year through delays in answering phone calls.

Chief executive Lin Homer told MPs yesterday that cost was made up of the time people lost on the phone to the service and the cost of the call charge, which accounted for about £34m of the total.

"We think if we increase the number of calls handled to the 90% we've held in the last quarter of this year, that will about halve the time of the call," she told the Commons Public Accounts committee.

Ms Homer said that would see the four minutes 42 second average waiting time drop to about two minutes but said that did not include how long customers had spent dealing with interactive voice recognition systems.

"We think real people start counting the call from when they pick up the phone so we are going to measure that and we reckon that will mean we will be achieving a call of about five minutes to six minutes," she added.

Mrs Hodge said: "Eighty per cent in 20 seconds is the industry norm and you're going 80% in five minutes. I think it's a dis-appointment. It's unambitious."