The Chartered Institute of Taxation (CIOT) has commented on the report of the Working Party chaired by Lord Howe: ‘Making taxes simpler’. Two of the CIOT’s major concerns have been addressed in the report: simplification of the tax system and detailed consultation.
Nick Goulding, CIOT President, said: “This is a welcome contribution to the debate around these two key issues. A complex tax system leads to avoidance and inefficiency of collection. As we have seen recently over CGT and the non-dom changes, it is vital to have detailed consultation in order to avoid unintended consequences.”
The report makes clear that the proposed Office of Tax Simplification has been modelled on a Tax Law Commission, as called for by the CIOT. It recommends a new joint Parliamentary Select Committee on Taxation with MPs and peers. This echoes the arguments made at a recent CIOT roundtable and in a subsequent briefing paper. The third recommendation of the report makes a strong commitment to propose tax legislation with complicated tax technical content no later than the Pre-Budget Report. This should help avoid the recent problems that we have seen.
Nick Goulding adds: “The CIOT’s overarching objective is to ensure that the tax system works effectively. We believe this requires legislation drafted to achieve simplicity, fairness and certainty. We understand that Government will sometimes need to respond quickly but with complicated tax technical legislation that can impact on people and business in an unforeseen way, we strongly believe that consultation is vital.”
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