The Chartered Institute of Taxation has welcomed the publication of a new Finance Bill1 today, but criticised the number of measures in the Bill not previously consulted on, and the apparent timetable for the Bill’s passage through Parliament, which it believes will harm scrutiny of the Bill.
Commenting, Glyn Fullelove, Chair of the CIOT’s Technical Committee, said:
“In our view, there are too many measures in this Finance Bill which have not been through the government’s tax consultation process.
“Just 37 of the 90 substantive clauses in the Bill, and 12 of the 19 lengthy schedules, were included in the draft bill published for consultation over the summer.
“Some of the measures not consulted on are rate changes and thresholds, which is understandable, but others are new proposals – such as the Structures and Buildings Allowance – and even a potential new tax – the Carbon Emissions Tax.”
At 315 pages the new Finance Bill is one of the shorter ones in recent years, though still significantly longer than last year’s 192 page Bill, which grew into a 196 page Finance Act.
Glyn Fullelove continued:
“The timetabling of the Bill2 adds to the ‘scrutiny deficit’. There are only two working days between the Bill’s publication today and its second reading debate on Monday (November 12th). Worse than that Parliament is currently in a short recess so most MPs will not be able to get their hands on a hard copy of the Bill until the day of the debate.
“With just four parliamentary sitting days between the publication of a large amount of previously unseen legislation and the start of the committee stage, which is supposed to see detailed line by line scrutiny of the Bill, there is a real risk this bill will not get the scrutiny it should.
“The effects of inadequate scrutiny in the past are visible in the amount of ‘tinkering’ in the new bill. This is mostly desirable tweaks to ensure that previously introduced measures – such as changes to corporate interest restriction and relief for carried-forward losses – operate as intended; but would all of these tweaks have been necessary if there had been adequate consultation and more thorough scrutiny in the first place?
“I worry that by rushing through measures like some of those in the current bill we are storing up problems for the future and, come next year’s bill, we will be back again to tidy up the flaws in the laws that will be rushed through over the next few weeks.
“CIOT, our Low Incomes Tax Reform Group and our close colleagues at the Association of Taxation Technicians will seek to provide briefing notes and other support to the MPs scrutinising the Bill as we always do. But the number of new measures, and the pace of the Bill’s passage, will inevitably limit how thoroughly we can do this.”
CIOT is continuing to call for a range of measures to enhance Parliament’s and the public’s ability to scrutinise tax proposals. These include more transparency from government, with clearer documentation; Finance Bill oral evidence sessions; better liaison between parliamentary committees looking at tax; more standing expert support on tax for Parliament.
Notes for editors
1. Finance (No.3) Bill is available here
2. We understand that Committee of the Whole House will take place on Monday November 19th and Tuesday November 20th with the public bill committee stage beginning on Thursday November 22nd. Second reading debate has already been announced for Monday November 12th.
3. The Chartered Institute of Taxation (CIOT)
The CIOT is the leading professional body in the United Kingdom concerned solely with taxation. The CIOT is an educational charity, promoting education and study of the administration and practice of taxation. One of our key aims is to work for a better, more efficient, tax system for all affected by it – taxpayers, their advisers and the authorities. The CIOT’s work covers all aspects of taxation, including direct and indirect taxes and duties. Through our Low Incomes Tax Reform Group (LITRG), the CIOT has a particular focus on improving the tax system, including tax credits and benefits, for the unrepresented taxpayer.
The CIOT draws on our members’ experience in private practice, commerce and industry, government and academia to improve tax administration and propose and explain how tax policy objectives can most effectively be achieved. We also link to, and draw on, similar leading professional tax bodies in other countries. The CIOT’s comments and recommendations on tax issues are made in line with our charitable objectives: we are politically neutral in our work.
The CIOT’s 18,400 members have the practising title of ‘Chartered Tax Adviser’ and the designatory letters ‘CTA’, to represent the leading tax qualification.
Contact: George Crozier, Head of External Relations, 0207 340 0569 or GCrozier@tax.org.uk
(Out of hours: 07740 477374)