More than 70,000 employees will make the switch, joining 2,500 Cabinet Office users already on Gmail. Google's obviously happy about it, with David Fitton, head of public sector sales for Google UK noting: "The acceptance by HMRC that they can store OFFICIAL information offshore in Google data-centres represents a major change and endorsement of Google's approach to managing sensitive information."

Of course, this is just one department, but HMRC is second-largest and arguably most-powerful government division. However, Microsoft still powers computers utilised by 450,000+ civil servants, and is still supporting their use of Windows XP. Still, it's interesting that while HMRC will collect the so-called Google Tax from the UK's biggest technology companies, it'll now pay a smaller tax of its own.

Update: An HMRC spokesperson has provided more background on the switch:

HMRC has an ambitious digital future planned. This contract will make it easier for staff to collaborate on internal documents - providing greater flexibility and efficiency, while reducing costs. Following a successful pilot, we are planning to roll out Google collaboration tools to more people throughout HMRC later this year. We have carefully considered the protection of customer information and this remains our highest priority.

[Image credit: HMRC, Flickr]