Single fiscal event here to stay, says tax minister at CIOT Parliamentary Reception

At the same event Institute President Ray McCann lamented the loss of ‘flexibility in the tax system’, such as extra statutory concessions which used to ‘oil the wheels of the tax system’.

The annual reception aims to bring together parliamentarians, their advisers and other policy makers and opinion formers with leading tax professionals, to improve the understanding of politicians and journalists of what tax advisers do and how the tax system works. It was held in the Terrace Pavilion at the House of Commons. Around 150 people attended, including 19 MPs and peers. In addition to the minister these included two members of Labour’s Treasury team, Shadow Chief Secretary Peter Dowd MP and Shadow Financial Secretary Anneliese Dodds MP.

Event sponsor Craig Mackinlay MP, a CTA who is still in practice, gave an opening speech in which he lamented that his stack of Tolley’s Yellow Tax Handbooks has got higher and higher despite the establishment of the OTS.

He then welcomed Ray McCann to his new role as President of the CIOT.

In a short speech Ray McCann, a former HMRC tax inspector, explained what CIOT does and how it can help parliamentarians in their tax policy and scrutiny work. He particularly highlighted the work of the CIOT’s Low Incomes Tax Reform Group in its 20th year and made a plea for more government support for the work of the tax advice charities.

Ray welcomed that much of the CIOT, IFG and IFS’ Better Budgets report has been taken up by the Government, especially the call for a single fiscal event with the ‘opportunity for a less frenetic approach to constructing tax policy, more considered measures and earlier consultation, so that by the time we get involved there are not too many ideas that people just refuse to move from’.

Finally Ray lamented the loss of ‘flexibility in the tax system’, saying: “I expect I am not the only one who laments the demise of the extra statutory concession and the loss of discretion HMRC believes is no longer open to it. Recently I had cause to think about forces families, some of whom appear to be paying the additional three per cent SDLT charge where they live on base at the point they buy a home. I have people looking at it but if it is the case it seems to me a classic example. Put simply, no matter how well intentioned or designed tax legislation is, it cannot anticipate everything that can arise. So ensuring that HMRC can exercise their management responsibilities in a principled way is essential.”

Financial Secretary to the Treasury Mel Stride (photographed above) said:

“It was about a year ago that I stood on this very platform and addressed you in what was my first outing as Financial Secretary to the Treasury and I have to say I knew very little about CIOT at that particular time. But in the intervening year, I have certainly established in my mind that it was entirely appropriate that the first outing I had as Financial Secretary to the Treasury and Paymaster General was to address you for the very reasons Ray has outlined, for the very central role that you play as an organisation - and all the tax professionals that feed into you in various ways - in shaping government policy in the area of tax.

“You raised the Better Budgets report, Ray, which was absolutely instrumental in ensuring that we moved towards the single fiscal event. You asked or posed the question ‘would we be sticking to our ground in this respect’ - we most certainly will.

“One of the most important things that we felt around the Spring Statement that we just had recently, was that this should not be another mini-Budget. So that required a lot of handling, handling the expectations and the media handling and so on, and we got that about right. We totally buy into this idea of decluttering the tax terrain, that we don’t want two or even more fiscal events in the year, we just want the one event in the autumn and we will certainly stick to that.

“There were many other things that came out of that work, and some of them apparently quite small and obvious and rather administrative in nature, but also I think very deep in value. For example, the consultation tracker launched at the Spring Budget so you can now go online and look at the 27 different policy areas upon which we are consulting at the moment, you can see when they start and see when they finish, you can click on easy to access links to find out all you need to know about them. This idea of getting information out and information flowing between yourselves and ourselves is extremely important.

“Whatever we have achieved to date it does not stop here, we are looking forward to closely engaging with you over the coming months; we obviously have the Autumn Budget to look forward to, there will be L-Day, legislation day, when we will publish some of the draft legislation that will appear in the forthcoming Budget, that will be sometime in July. It will be in July that you will be able get your hands on that.

“We also have, of course, Making Tax Digital and one of the first decisions I took as minister was to slow down the timescale of Making Tax Digital, and CIOT, along with other organisations, were instrumental in persuading me of the importance of taking that particular route.

“The final thing, of course, that I will mention is Brexit. We have a huge challenge ahead of us with Brexit, we have huge opportunities as well at the same time. As we go through this process, perhaps never at any other time in our history - perhaps that is slightly grandiose but not far off it - has it been more important to make sure we get the tax system stable, working, competitive and something that supports business and drives our economy forward.

“On that positive note, can I thank you, again, for all that you do individually in this great endeavour of making sure our tax system is fit for purpose.”

Audio recordings below:
(You may need to turn your volume up because of background noise)

Mackinlay introduction and Ray's speech - here

Short speech by tax minister Mel Stride - here

By Hamant Verma.