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This is the third of a series of reports on the progress of this year's Finance Bill, as it goes through its various parliamentary stages.

There have been no further sittings of the committee since the last report so this report covers the timetable for the remainder of the Bill's progress.

A note on the stages the Finance Bill goes through appears here.
Links to the various debates are available here.

Where are we now?
In the early stages of standing committee debate. After four sittings, only four clauses have been covered by the standing committee, with debate concluding on April 26 after the approval of clause 6. Because of prorogation ahead of the Queen’s Speech on May 9th, the committee did not sit from April 26 to May 22.

When does committee restart?
Tomorrow, Tuesday May 22. There will be four sittings this week (sittings 5-8). Parliament then goes on recess for two weeks, returning on June 11th. So committee sittings 9 and 10 will take place on Tuesday June 12th, with two sittings each Tuesday and Thursday until the final sittings (17 and 18) on Tuesday June 26th. The sittings are from 10.30am and 4.30pm on Tuesdays, and 9am and 1pm Thursdays.

What is the timetable for what gets debated when?
There is no formal timetable for what gets debated at each committee sitting. The clauses are being debated in the order they appear in the Bill, with the schedules associated with them debated at the same time. Clauses and schedules debated in committee of the whole House (CWH) will not be debated again in standing committee. (This means, for example, that the 50 minutes of debate in CWH on the child benefit charge is all it will get during committee stage.)

It is difficult to predict with any accuracy what point will be reached at each sitting of the committee. Some clauses may be straightforward in their effects but have a lot of MPs wanting to chip in on the topic (e.g. the income tax personal allowance) which can mean they take up a disproportionate amount of time. Much will depend on whether the committee actually debate the insurance and friendly society clauses (55-179) in any meaningful way.

For what it’s worth my guess, based on what MPs will want to most talk about, or around, combined with a degree of optimism that the slow pace so far will pick up and we won't end up with clauses in the second half of the Bill being rushed through in the final couple of sittings, is that timings will be along the lines of -

Tue May 22 (sittings 5 and 6) – clauses 7-24 (including anti-avoidance measures, income tax reliefs, corporation tax changes (including patent box, R&D relief, REITs, loan relationships) (NB. Not including child benefit, which was CWH)

Thur May 24 (sittings 7 and 8) – clauses 25-46 (including CGT, enterprise allowances (SEIS, EIS, VCT), capital allowance changes)

Tue Jun 12 (sittings 9 and 10) – clauses 47-179 (including charitable giving, insurance companies, friendly societies)

Thur Jun 14 (sittings 11 and 12) – clauses 180-188 (including controlled foreign companies, oil, tobacco and alcohol duty) (NB. Not including air passenger duty, which was CWH)

Tue Jun 19 (sittings 13 and 14) – clauses 190-204 (gambling duties, VED, VAT, landfill tax) (NB. Some debate on changes to VAT exemptions during CWH but may be more)

Thur Jun 21 (sittings 15 and 16) – clauses 205-215 (including climate change levy, inheritance tax (inc gifts to charities), SDLT)

Tue Jun 26 (sittings 17 and 18) – clauses 216-225 (including UK Swiss agreement, financial sector regulation, incapacitated persons, dishonest conduct by tax agents, info powers, PAYE regulations, new tax on ownership of high value properties, repeal of reliefs (OTS/simplification) plus new clauses

NB. This is only an educated guess and not to be relied upon!

What amendments have been tabled?
Among the amendments which have been tabled so far to the parts of the Bill yet to be reached are:
• Labour amendment on qualifying time deposits to require HMRC to draw up plans to ensure that investors who are eligible to receive interest payments gross are made aware of the need to register with their account provider, to ensure that they do not overpay income tax
• Amendments from Conservative MP Nigel Mills on R&D reliefs and loan relationships
• A number of government amendments to clause 24 (Companies carrying on business of leasing plant or machinery)
• A Lib Dem / Green /SDLP amendment to delay coming into effect of CFC rules until an impact assessment has been prepared and approved by MPs, reviewing the effect of the proposals on developing countries’ tax revenue, and aid and technical assistance being provided to developing countries to increase the capability and technical expertise in their tax regimes

When will the Bill get Royal Assent?
There is only a short period between the end of committee stage (Jun 26) and the rise of Parliament for the summer recess on July 17. However this should still be enough time to fit in report stage and third reading (1-2 days) in the Commons and the one day of debate the Bill will get in the Lords (the Lords don't amend tax legislation so they will only have a second reading debate) before Parliament rises.

So Royal Assent in July is a reasonable working assumption and will almost certainly be the case. However, unlike previous years, this is not certain and Royal Assent could theoretically be as late as October 26. (For why, see here).

George Crozier
CIOT External Relations Manager
Monday 21 May 2012

This is the second of a series of reports on the progress of this year's Finance Bill, as it goes through its various parliamentary stages.

This report covers the first four sittings of the standing committee on the Bill, which sat on Tuesday 24 and Thursday 26 April, and made only slow progress. As previously noted, these reports focus on the aspects of the debates most relevant to the CIOT and our members, which is primarily the technical elements of the Bill, although the reports will aim to give a flavour of the main issues debated, which will often be more political.

A note on the stages the Finance Bill goes through appears here.
Links to the various debates are available here.

Finance Bill Standing Committee – Sitting 1 – Tue 24 Apr (am)

Clause 2 - basic rate limit for income tax

Not much of technical interest. Mostly speeches by Labour MPs about people suffering from government tax increases and other austerity measures, primarily focusing on those on the threshold of the higher rate of income tax who are being drawn into the higher rate by fiscal drag. Notionally the discussion was on clause 2 (basic rate IT limit) but debate was far more wide-ranging, from the cost of living to the relative merits of different taxes for helping those on lower incomes.

Finance Bill Standing Committee – Sitting 2 – Tue 24 Apr (pm)

Clause 2 (continued), clause 3 (personal allowance for under-65s)

Again, debate focused on the effects of the Government's fiscal policies, rather than technical scrutiny of the Finance Bill measures. In theory the discussion was about the personal allowance for people of working age (clause 3). Session interrupted by two divisions in the House as well as two in the committee. Inbetween Owen Smith MP (Shadow Exchequer Secretary and Labour's lead spokesperson on the committee) spoke at length, mostly about the effect of measures not in the Finance Bill on people on low and middle earners which, he argued, outweighed the increases in the personal allowance. There was a brief contribution from Lib Dem John Pugh calling on the Treasury Committee to do more retrospective assessment of tax changes. The rest of the time saw three Labour MPs give scathing assessments of the effects of the Government’s policies on those in poverty.

Finance Bill Standing Committee – Sitting 3 – Thur 26 Apr (am)

Clause 3 (continued)

Once again, slow progress. Debate notionally on clause 3 (the personal allowance for people of working age) continued but did not conclude. The double dip recession, regional pay and a Conservative MP’s efforts to give up smoking were among the diversions. Ongoing disputes over the cost of cutting the 50p rate and the wiping out of the personal allowance increase by other measures made a reappearance. The sitting concluded midway through the Labour spokesman’s winding up speech.

Finance Bill Standing Committee – Sitting 4 – Thur 26 Apr (pm)

Clause 3 (continued), clauses 5 and 6 (corporation tax main rate)

Slightly faster progress. Labour’s spokesman Owen Smith concluded his summing up on clause 3 (personal allowance for under-65s) and the committee then approved clause 3 and rejected a Labour amendment proposing a review of “the overall impact on families of this section compared with other measures the Government is introducing”.

Owen Smith then opened the debate on clauses 5 and 6 (corporation tax main rate). His arguments were essentially (a) that the Chancellor is a ‘one club golfer’ betting the farm on CT, and (b) that business confidence has collapsed because there is no belief the Government will deliver growth. There was much back and forward over the relationship between cutting CT and growth, with Labour unconvinced that there is much of one. While sceptical of its impact, Labour did not oppose the CT cut, arguing that the economy needs all the stimulus it can get. Two Labour amendments to the CT clauses were pushed to the vote, calling for reviews on the impact of CT on business investment, and growth and jobs. Both were rejected as the committee divided again along party lines. Clauses 5 and 6 were approved.

There were three speeches of note from the backbenches during the debate on CT, with Conservatives Nigel Mills and Charlie Elphicke, both former tax professionals, once again making interesting contributions. Mills called for radical reform (simplification) of CT – preferably using the OTS - and said he might table amendments to do this at Report Stage. He advocated allowing companies to file a single tax return, rather than them having to file dozens of separate returns. He also drew on his professional experience, explaining how he used to compare various tax regimes and their attractive features: “One of the problems with the United Kingdom is that we could probably tick most of the criteria [but] there had to be a tick with a little star in brackets next to it beside phrases such as, “Yes, we exempt capital gains on sales of overseas companies, but that is quite complex and we have difficult rules on what a share is.”

Elphicke said rules should be made more purposive – pursuing substance over form: “ensure that companies that are trading here and have trading revenues here pay their fair share of tax in this country.” We should ask: “is that person paying tax somewhere on that deduction or are they paying no tax at all?” Mills said he had some sympathy with Elphicke’s argument. Elphicke, in turn, agreed with Mills’ suggestion that we remove “the arcane definitions that enable businesses to argue that they are not within the charge to UK tax.”

Inbetween, Labour MP Fabian Hamilton drew on his experience running a small business to speak about the frustration felt by small business owners at the level of bureaucracy they face. He said that they spent a lot of time not selling products but filling in forms and dealing with inspectors. Forget CT, he said, the biggest problem was being able to make a profit at all and collect money owed (problems with bad debt).

David Gauke’s speech winding up the debate was a now familiar defence of the Government’s strategy of CT cuts as “an advertisement for investment and jobs in Britain”. He quoted favourable remarks from the tax and business community about the Government’s corporate tax strategy. He accused Labour of drifting away from business and from the centre ground.

The week's decisions by the standing committee

Tuesday 24 April

Amendment 8 (Lab Treasury team)
Clause 2, page 2, line 27, at end add—
‘(3) The Chancellor of the Exchequer shall review the impact of the setting of the basic rate limit on increasing the number of higher rate income tax payers and place a copy of the review in the Library of the House of Commons.’.
Vote: Ayes 13, Noes 19

Amendment 9 (Lab Treasury team)
Clause 2, page 2, line 27, at end add—
‘(3) The Chancellor of the Exchequer shall review the impact that setting the basic rate limit will have on average tax rates paid by total income and a copy of the report shall be placed in the House of Commons Library.’.
Vote: Ayes 13, Noes 19

Clause 2 (basic rate limit for 2012-13) stand part
Approved without a division

Thursday 26 April

Amendment 10 (Lab Treasury team)
Clause 3, page 2, line 33, at end add—
‘(3) The Chancellor of the Exchequer shall review the overall impact on families of this section compared with other measures the Government is introducing and place a copy of the review in the Library of the House of Commons.’.
Vote: Ayes 13, Noes 15

Clause 3 (personal allowance for 2012-13 for those aged under 65) stand part
Approved without a division

Amendment 4 (Lab Treasury team)
Clause 5, page 4, line 12, at end add—
‘(3) The Chancellor of the Exchequer shall review the impact of the corporate tax structure including the principal rates and investment allowances on the level of business investment, and place a copy of the review in the Library of the House of Commons.’.
Vote: Ayes 13, Noes 15

Amendment 11 (Lab Treasury team)
Clause 5, page 4, line 12, at end add—
‘(3) The Chancellor of the Exchequer shall review the impact of the corporate tax structure on different sectors and place a copy of the review in the Library of the House of Commons’.
Amendment withdrawn

Amendment 12 (Lab Treasury team)
Clause 5, page 4, line 12, at end add—
‘(3) The Chancellor of the Exchequer shall review the impact of the corporation tax rate on growth, jobs, and investment in the economy, and produce a plan for jobs and growth, which he shall lay before the House of Commons.’.
Vote: Ayes 13, Noes 15

Clause 5 (main CT rate for 2012) stand part
Approved without a division

Amendment 5 (Lab Treasury team)
Clause 6, page 4, line 19, at end add—
‘(4) The Chancellor of the Exchequer shall review the evidence in favour of using reductions in the headline rate of corporation tax as a means of promoting long term international competitiveness and place a copy of the review in the Library of the House of Commons.’.
Amendment withdrawn

Clause 6 (CT charge and main rate for 2013) stand part
Approved without a division

George Crozier
CIOT External Relations Manager
Wednesday 2 May 2012

This is the first of a series of reports on the progress of this year's Finance Bill, as it goes through its various parliamentary stages.

For those not familiar with the parliamentary process for scrutinising bills (which is in any way a bit different for Finance Bills), it runs like this:
First reading - Presentation of Bill, no debate
Second reading - Full day's debate (about 6 hours) on the floor of the House of Commons on any aspect of the Bill MPs want to raise
Committee of Whole House - The opposition (mostly Labour but with a bit of say for the smaller parties) choose the key bits of the Bill which they want to have high profile debate and votes, with the opportunity to propose amendments, on the floor of the House of Commons. Two days of debate on these.
Standing Committee - 36 MPs, appointed from each party in proportion to their representation in the House of Commons, debate the remaining clauses and schedules of the Bill in order, in a committee room 'upstairs', with the opportunity to propose amendments.
Report stage - One or two days (probably two) debate on the floor of the House with another opportunity to present amendments.
Third reading - One hour debate on the Bill as amended, immediately after report stage.
Lords second reading - Peers debate any aspect of the Bill they wish to raise. (NB. There is no opportunity for Peers to amend the Finance Bill, and third reading is taken without debate.)

The progress of this year's Finance Bill has been both rapid (three days of whole House debate last week and already four sittings of standing committee, which started on Tuesday) and slow (by the end of the third sitting only one clause had been approved. The CIOT takes a close interest in tax legislation and speaks to MPs from all parties during its passage in support of our aim of a better, more efficient, tax system for all affected by it – taxpayers, advisers and the authorities. We focus on drawing on our members’ experience in private practice, government, commerce and industry and academia to argue and explain how public policy objectives can most effectively be achieved. We are, of course, strictly politically neutral.

The reports on this blog are a by-product of our work following the Bill. They focus on the aspects of the debates most relevant to the CIOT and our members, which is primarily the technical elements of the Bill, although the reports also aim to give a flavour of the main issues debated, which will often be more political. I am not aiming to cover all contributions or all of the political debate about tax rates, inequality and the relative records of the current and previous governments.

Brief summary of debates on the floor of the House last week

Finance Bill 2nd reading – Mon April 16

Wide ranging debate. Exchanges between the frontbenches were mostly political and broad brush (not technical). Labour spokesmen and backbenchers criticised the Budget over fairness (tax cuts for millionaires, etc.) and failure to do enough for growth and jobs.

Some interesting contributions from Conservative MPs on the backbenches. Mark Field (MP for Cities of London and Westminster) expressed concerns about retrospective taxes (ref. Barclays) and the effect of the SDLT proposals in stalling developments in central London. Christopher Chope criticised the child benefit proposals over fairness (lack of) and complexity and suggested levying a charge on all taxpayers earning over £60,000 to avoid discriminating against those with children. Richard Harrington gave a thought-provoking speech in support of capping tax relief on charitable donations, asking: “Should people be able to choose to support, say, the National Theatre, the opera and Christian Aid, while choosing not to support the national health service, education and social services?” Edward Leigh spoke in support of a flatter tax system. Former tax lawyer Charlie Elphicke attacked “massive and inexcusable tax avoidance by multinationals” and set out a series of proposals, including that every MNC should be required to publish an effective rate of tax paid on UK revenues - from UK sources, from UK territory and from its UK trade – and called for reform of branch tax rules.

From the Lib Dem benches, Stephen Williams acknowledged concerns about the effects of CFC reforms, saying: “I hope we can find a way of measuring their effects and supporting overseas tax authorities more effectively to collect their tax liabilities so that they are not adversely affected by changes we are making to our basis for taxation.”

For the SNP, Stewart Hosie of the SNP emphasised opposition to high air passenger duty.

Finance Bill Committee of Whole House Day 1 – Wed April 18

The longest debate focused on the cutting of the 50p rate to 45p. There was a brief spat over Labour’s failure to table an amendment reversing the change, which it was argued would have been out of order had they done so. This prompted one Labour MP (Chris Bryant) to argue for changes to the rules that mean that the only people who can ‘lay a charge’ are ministers. The rest of the debate was essentially political 'back and forward', with more heat than light, although Charlie Elphicke (Conservative) made an interesting contribution, drawing on his experience as a tax lawyer to talk about some of the ways in which people may have avoided the 50p rate, in addition to forestalling, such as personal service companies and drawing income in dividends.

Debate on the bank levy was also highly political, with opposition comments mainly on proposals for a new levy on bankers’ bonuses to provide money for job creation for young people. Argument largely focused on how much different taxes on banks/bankers had raised or would raise. Karen Bradley, a CIOT member, argued that government actions to limit the level of cash bonuses that can be paid were far more effective in tackling the bonus culture than Labour’s bonus tax.

Debate was more cross-party on the VAT changes. Eight MPs (all with a constituency interest) spoke against VAT on static holiday caravans. Three MPs spoke against VAT on pasties and other baked products. Four MPs spoke against VAT on alterations to churches and other historic buildings. One argued there should be a VAT exemption for dial-a-schemes for people in wheelchairs. Exchequer Secretary David Gauke responded with a measure by measure explanation of the reasons for the changes. Despite substantial rebellions from government backbenchers no amendments got through. The narrowest margin was a 287-262 government win on VAT on static caravans.

Finally there was a brief debate at the request of the nationalists on air passenger duty, arguing for Wales and Scotland to have APD devolved as well as Northern Ireland. This was opposed by the Government, and Labour were essentially neutral and abstained.

Finance Bill Committee of Whole House Day 2 – Thur April 19

The day’s main debate was on the phasing out of age-related allowances. The Labour spokesperson, Rachel Reeves, accused the Government of attempting to hide behind the Office of Tax Simplification. The minister responded by saying the changes would remove complexity and confusion for some taxpayers and had to be looked at in the context of overall government policies for pensioners. Debate divided along party lines. The most interesting speech was from former accountant Nigel Mills (Conservative) who spoke in support of simplifying tax for pensioners, including support for putting the state pension into PAYE and for merging income tax and NI.

The child benefit charge got less than an hour of debate, which was a disappointment, given the number of questions which still remain around it. Christopher Chope (Conservative) proposed amendments that would limit the charge to households with an income of £100,000. Labour’s spokesperson, Cathy Jamieson, raised a series of pertinent questions around how workable the proposal was. The minister made a credible defence in the brief time available but there was not really enough time for a full debate and many questions remain unanswered. Sadly, because this has been debated in Committee of whole House, it will not get further debate during standing committee (though hopefully there will be an opportunity for further debate at report stage).

Links to the various debates are available here. A report on the opening sittings of the standing committee will be posted tomorrow (Friday).

George Crozier
CIOT External Relations Manager
Thursday 26 April 2012

The Treasury Committee’s report on Budget 2012 has been published today, as MPs prepare for the first of two days of ‘whole House’ debate on the 2012 Finance Bill.

The CIOT is delighted that members of the Committee have listened to and endorsed so many of the points made by the Institute in our evidence. The Institute’s Tax Policy Director, John Whiting, who was the only tax or accountancy professional invited to give oral evidence to the Committee, is widely quoted in the report.

Pages 38-39 of the report focus on retrospective tax measures. John Whiting’s comments to the Committee about the potential this has to do damage to the image and reputation of the UK tax system, and how it could lead to lazy drafting of legislation, are quoted at length in the report. The CIOT’s own paper on retrospection, published 18 months ago, is also mentioned. The Committee recommends that the Government restrict its use of retrospective legislation to wholly exceptional circumstances, which should be narrow and clearly-defined. It calls on the Treasury to set these out as soon as possible for consultation, along with an explanation of how gradual further extension of retrospection can be prevented. It also calls for any further retrospective measures to be justified against the agreed criteria, including clear explanatory statements to Parliament by the responsible Minister and an invitation for views from relevant professional bodies. The CIOT is delighted that the main points of our 2010 paper have been so comprehensively taken up by the Committee.

More specifically, the Committee ask the Government to clarify what retrospection is proposed with regard to stamp duty, following remarks made by the Chancellor in his Budget statement that he “will not hesitate to move swiftly, without notice and retrospectively if inappropriate new ways around these new rules are found”. This should also be something to watch out for.

The proposed changes to child benefit entitlement get close attention in the report. The CIOT’s remarks about the substantial administrative load the changes will place on HMRC and our observation that the changes further erode the system of independent taxation are both highlighted by the Committee. The report notes the further complexity the changes will bring and promises the Committee will review the effect of the changes on HMRC in their regular hearings with the department.

The phasing out of age-related allowances (the so-called ‘Granny Tax’) has been one of the most controversial aspects of the Budget. John Whiting’s remarks to the Committee are quoted at length, and the report notes that John also performs the role of Tax Director of the Office of Tax Simplification. The Committee praises the Government for setting up the OTS but notes that ministers nevertheless took the decision to phase out ARAs whilst aware the OTS were giving this area detailed examination. The Committee expresses a hope that in future the Government will take proper recognition of the work of the OTS.

On the cap on income tax reliefs, the CIOT’s evidence warning of the potential impact on business investment and charities is extensively quoted. The Committee recommend that the Treasury ask HMRC to make an assessment and publish the impact of the cap on these two areas.

The Committee also explored the Government’s cuts in corporation tax. Paragraph 123 quotes the CIOT’s oral evidence that while the headline CT rate is “part of the shop-window for businesses” a majority of businesses will gain no benefit because they pay the small profits rate or are unincorporated. Many will also be losing out from capital allowance cuts. In its recommendations the Committee notes this warning and calls on the Government to monitor, and report on, the impact of the reduction in CT on businesses of all sizes.

On tax simplification the report quotes John Whiting’s comments that the tax system has got simpler “where there has been good consultation and things have evolved carefully” and his supportive remarks about the proposal for a new Personal Tax Statement for 20 million taxpayers, while noting his proviso that “[t]here is a lot of design work to be done on these statements”. In their recommendation the Committee agrees that personal tax statements could add some additional transparency for taxpayers and says the Treasury should consult the OBR on their design.

The report also reproduces the assessment of the CIOT, alongside those of the ICAEW and ACCA, on how well the Budget complies with the principles of fairness, supporting growth, certainty and simplicity, stability, practicality and coherence.

The full report (88 pages) is available here and the press summary can be read here. For those in a hurry, the summarised summary on tax is:
• The Government should restrict its use of retrospective legislation to wholly exceptional circumstances, which should be narrow and clearly-defined
• HMRC should publish in due course a comprehensive assessment of the effect on the Exchequer of the new 45p rate
• The Government's latest proposals for reform of Child Benefit add further complexity
• Personal tax statements could add some additional transparency for taxpayers. The Treasury should consult the OBR on their design
• We will review the effect of the changes on HMRC, where further staff reductions are being implemented, in our regular hearings with it

And on non-tax issues:
• There will be a new Treasury Committee inquiry into the macroprudential tools (such as sectoral capital requirements) that the Bank of England’s Financial Policy Committee is to be given
• Quantitative easing is penalising savers. Bank of England and Treasury should provide an estimate of the overall benefit and loss to pensioners and savers from QE
• OBR should consider a wider range of risks and associated scenarios in future forecasts
• Coalition government is no justification for pre-Budget leaks!
• There needs to be longer between the Budget and Finance Bill second readings which probably means earlier Budgets

As always, the CIOT’s comments and recommendations on tax issues are made with the aim of achieving a better, more efficient, tax system for all affected by it – taxpayers, advisers and the authorities. We are strictly politically neutral in our work, working with parliamentarians from all parties, and drawing wherever possible on our members’ experience in private practice, government, commerce and industry and academia to argue and explain how public policy objectives can most effectively be achieved.

George Crozier
CIOT External Relations Manager
Wednesday 18 April 2012

The Chancellor’s appearance before the Treasury Select Committee yesterday afternoon makes a number of today’s newspapers. (See, for example, Osborne feels the heat on 'pasty tax' and cut in 50p rate‎ in The Independent.)

This is a traditional post-Budget event. What is less well known is that, in preparation for their grilling of the Chancellor, the Committee invites a number of expert witnesses to give evidence to them the morning before. CIOT Tax Policy Director John Whiting was once again one of this select group yesterday. If you want to watch John being questioned by the Committee on issues including retrospection, tax complexity and age-related allowances, click here and go to 11.30.

Watch out for the Finance Bill which will be published tomorrow.

George Crozier
CIOT External Relations Manager
Wednesday 28 March 2012

CIOT Chief Executive Peter Fanning represented the Institute at the launch today of a Social Mobility Toolkit for the Professions at RICS’ headquarters in Parliament Square.

The toolkit has been produced by Professions for Good, the umbrella group for professional bodies, including the CIOT, with a combined membership of 1.2 million people. It can be downloaded here.
http://www.professionsforgood.com

The toolkit includes a great deal of background on why social mobility is important, including why it makes good business sense, as well as case studies and best practice advice for both professional bodies and individual employers on monitoring and improving social mobility.

This project has top-level government backing. Deputy Prime Minister, Nick Clegg, said: "Professions for Good has created an impressive resource illustrating the importance of social mobility and giving everyone a fair chance. Britain's workplaces need to open up. Great strides are being made, but more is still to be done and I encourage all employers to join in."

The CIOT and ATT have issued a joint press statement http://www.tax.org.uk/media_centre/Press+Releases/social_mob_push welcoming the initiative. We believe our profession has much to be proud of in terms of accessibility and our contribution to social mobility (it is instructive that both Patrick Stevens and Stuart McKinnon are able to refer to their personal experiences early in their career in their comments in the press statement). But it is always right to explore if we should be doing more and that is what the Institute will reviewing over the course of the year, using the new toolkit as a resource to assist us.

It is also worth noting Stuart McKinnon’s challenge in the press statement to all members of the profession who have at some time been given a similar break to his which enabled them to get onto the career ladder in tax: take on one trainee and give them the break you got.

The Institute is always keen to hear from members with ideas, so if you have any in this area do please get in touch with me at gcrozier@tax.org.uk.

George Crozier
CIOT External Relations Manager
Friday 2 March 2012

Revenuebenefits.org.uk is a relatively new (it was launched in July 2011) website, put together by the Low Incomes Tax Reform Group and rightsnet, and is designed to provide advisers with access to the latest information on the range of HMRC 'products', including tax credits, child benefit and guardian’s allowance and the national minimum wage.

The latest news for those working in this area is that the site now contains a complete set of up-to-date (consolidated) tax credits legislation.

Since 2002, when tax credits were introduced, there have been a large number of amendments to the legislation in this area. For advisers who need to understand the legislation as it applies today, the task of applying numerous pieces of amending legislation to the original versions is very time consuming and makes reliable interpretations extremely difficult. That is why the consolidated legislation (primary and secondary) – helpfully provided by Tolley Tax Intelligence and LexisNexis – is so useful. It will be updated quarterly or as new regulations are made.

George Crozier
CIOT External Relations Manager
Wednesday 8 February 2012
(with thanks to James Stevens of LITRG, whose blog post this largely paraphrases)

The publication yesterday of the Government’s response to the House of Commons Environmental Audit Committee’s report on ‘Budget 2011 and environmental taxes’ has brought us no nearer to a clear definition across government of what an environmental tax is.

However it is good to see the committee chair and media continuing to press this issue, which was first brought to their attention by the CIOT in our submission to the committee back in May:

The Treasury listed six taxes which it regards as environmental taxes—Climate Change Levy, Aggregates Levy, Landfill Tax, EU Emissions Trading System, Carbon Reduction Commitment and the Carbon Floor Price. As the Chartered Institute of Taxation explained, however, the ONS's 2010 Environmental Accounts also included Fuel Duty, VAT on Fuel Duty, Renewable Energy Obligation, Vehicle Excise Duty and Air Passenger Duty in its definition (and confusingly Air Passenger Duty appeared under an 'environmental tax' heading in the 'budget policy decisions' table in this year's Budget Report).
Paragraph 9, ‘Budget 2011 and Environmental Taxes’, Environmental Audit Committee, 29 June 2011

In a report in yesterday’s Guardian (‘MPs condemn Treasury's green tax strategy - The government has made it difficult to judge whether promises are being met by refusing to define environmental tax’), Joan Walley, chair of the committee, is quoted saying: "[This] is an unacceptable delay... which does not address our pivotal recommendation for clarity about what constitutes an 'environmental tax' and the need for an environmental taxation strategy."

The committee’s call for an environmental tax strategy is in line with the CIOT’s call for an Environmental Tax Framework (modelled on the existing Business Tax Framework) to enable business and others to plan ahead with confidence.

The CIOT, as an organisation, does not take sides in the argument over whether environmental taxes should be higher or lower overall, but we do, through our Environmental Taxes Working Group, contribute to the debate about how government objectives in this area can be most effectively achieved. In particular, we point out how taxes which merely shift pollution elsewhere, or which leave loopholes which can be exploited, or which fail to lead to greener behaviour because of a lack of alternatives, will fail to do their job.

With this in mind, we were pleased to be one of the three bodies most cited in the main body of the June EAC report (along with the Green Fiscal Commission and Campaign for Better Transport) and the most cited in the footnotes, which included five references to our 2009 Green Tax Report, commissioned by Nick Goulding during his time as CIOT President.

George Crozier
CIOT External Relations Manager
Tuesday 7 February 2012

I am very pleased to say that the results of the November 2011 CTA and ATT examination sessions have been announced.

CIOT President, Anthony Thomas, commenting on the CTA results said:

"I would like to offer my congratulations to all 961 of the candidates who have made progress towards becoming a Chartered Tax Adviser as a result of passing one or more papers at the November 2011 examination. 327 candidates have now successfully completed all of the CTA examination and we very much look forward to them becoming members of the Institute in the very near future.

"Our examinations allow candidates a choice of which Advisory Papers to take and it is very important that they do choose the papers which are most relevant to them."

Full details of prizes and results can be viewed here

909 candidates took the examinations of the CIOT’s sister body, the Association of Taxation Technicians, on 1 and 2 November 2011. The Association is pleased to report that 69 candidates attempted the required four papers for membership and of those 51 (74%) passed all four papers.

The Association President, Stuart McKinnon, commenting upon the results said:

“It gives me great pleasure to congratulate all the successful candidates from the November sitting of our exams. In total 1,592 papers were sat and 1,076 passes achieved in one or more of our seven papers with 66 distinctions awarded for exceptional performance.

“Our modular system allows candidates to study at their own pace. Whether they are working towards full membership by sitting the three compulsory and one optional paper or whether they simply wish to obtain one or more Certificates of Competency in their specialist areas the flexibility has proved very popular.

“As a result of the examinations 228 candidates have now completed the examination requirements for membership and I look forward to meeting as many as possible at our popular admission ceremonies held at the House of Lords.”

Full details of prizes and results can be viewed here

Jude Maidment
Education and Examinations Manager
Wednesday 18 January 2012

Good to see another CIOT idea may come to fruition.

Today’s Times reports that the Government’s ‘nudge unit’ (officially the Behavioural Insight Team) are recommending that self-assessment taxpayers who pay their tax bill early are entered into a prize draw with a chance of winning £100,000.

The idea is this would save money by spreading the pressure on HMRC’s servers which currently experience a huge surge in the final few days ahead of the online filing deadline of Jan 31st.

A government source is quoted in The Times as saying: “Though nothing similar has been tried on a national basis before, 15 London local authorities have recently introduced a prize draw to encourage people to pay council tax by direct debit. With a £25,000 prize, they realised savings of £345,000 a year.”

A good idea? We think so. In fact a couple of years ago, during meetings on the Carter Review, colleagues of mine at the CIOT suggested just this to HMRC. At the time the Revenue were wary and told us they didn’t think government could do this sort of thing (though we did point out that the DVLA in Swansea were trying something similar), so the idea has been gathering dust.

Hopefully with a bit of a nudge from the nudge unit this imaginative proposal will now finally see the light of day, and save HMRC resources that can be put to better use.

George Crozier
CIOT External Relations Manager
Tuesday 10 January 2012