Tax Update (July 2010)
Plans to simplify Britain's tax system.
The Government has just established the Office of Tax
Simplification (OTS) and first to be reviewed will be tax reliefs
and small business tax simplification (including IR35).
Michael Jack, who served as financial secretary to the Treasury
in John Major's government, and John Whiting, a former tax partner
at PricewaterhouseCoopers, have been appointed as an unpaid two-man
board, based in the Treasury, for the next 12 months.
They will identify areas where complexities in the tax system
for both businesses and individual taxpayers can be reduced and to
publish their findings for the Chancellor to consider ahead of his
Budget.
Shadow Treasury chief secretary Liam Byrne told the Commons:
"Simplification is a good thing."
But he warned that the creation of a new Office for Tax
Simplification (OTS) sounded "more like an attempt to grab
headlines than real evidence of a push to improve legislation".
Answering an urgent question on 20 July 2010, Treasury Exchequer
Secretary David Gauke said a complex tax system created
"uncertainty and instability", sending the wrong signal to
businesses wanting to invest in Britain.
"A complex tax system also means that businesses end up spending
more time dealing with their tax affairs and less time on their
core business," he added.
The OTS will be asked first to study around 400 tax reliefs to
see how many can be removed.
If you have any questions as a result of this article, please
contact the Advice Service to speak with an expert.