Tax Day: Welcome review for tax processes, but what about the policy?

The Chartered Institute of Taxation (CIOT) has welcomed the publication of a number of consultations and calls for evidence on the administration of the tax system, but called on the Government to consult further on its plans for future tax policy, including fiscal consolidation, too.

Commenting on the innovation of ‘Tax Day’, John Cullinane, CIOT Director of Public Policy, said:

“We welcome the establishment of a ‘tax consultation day’ in addition to the Budget as an opportunity for more focused scrutiny of tax measures and for broadening the public conversation about tax.

“Early and open consultation, seeking views and ideas as widely as possible at the earliest possible stage of policy development, leads to better tax law and administration, which is in the interests of both taxpayers and their advisers, and the tax authority. We look forward to responding to the consultations launched today and encourage others to do likewise.

“However we are disappointed that while the Government are engaging in welcome, detailed consultation on the administration of the tax system, neither the Budget nor Tax Day has seen any substantial new consultations or calls for evidence on reform of tax policy. This is a missed opportunity.

“As the House of Commons Treasury Committee recently identified, there are numerous aspects of the tax system in need of review, from the taxation of different forms of employment to property taxation. People are keen to know where things are going on fiscal consolidation. The benefits of wide, early public consultation apply in these areas too.”

Commenting on the call for evidence on HMRC’s Tax Administration Framework, John Cullinane said:

“The UK’s tax system has been creaking at the seams for a long time and this thorough review is overdue.

“This is an ambitious framework for modernising the administration of the UK’s tax system. We call on the Government to show similar ambition in taking forward wider tax policy reform over the years ahead.”

Commenting on the role of agents in the tax system, Richard Wild, CIOT’s Head of Tax Technical, commented:

“It is welcome that the call for evidence reinforces the commitment in the ten year tax administration strategy to improve services for tax agents. It is a commitment in HMRC’s Charter that a taxpayer can appoint someone to represent them. However, on too many occasions – including recent measures such as the Trust Registration Service and the 30-day CGT reporting service – this is made incredibly difficult to do.

“Agents play a key role in ensuring compliance with a complex tax system. More revenue is lost to error and mistakes than to deliberate non-compliance. Employing an agent is one action taxpayers can take to make it more likely they get their taxes right.”