HMRC has just released a flurry of consultations, calls for evidence and other documents relating to tax policies and administration, in its policy document – Tax policies and consultations (Spring 2021).
As mentioned at the Budget 2021, the government wanted to keep the announcement of such measures and consultations separate from the Budget itself, hoping to provide greater transparency and opportunity for scrutiny and improve overall quality of tax policy and legislation. As a result many are dubbing yesterday, 23 March 2021, “Tax Day”.
Both the Treasury and HMRC are keen to “enhance the stability and effectiveness of the UK tax system” and the document they have issued today sets out the next steps in delivering the 10 year tax administration strategy set out in July last year.
The document covers reforms and policy developments across a range of issues including business rates, environmental taxes, simplification measures, updating on existing consultations as well as announcing new areas under review.
It covers plans to
- Modernise tax administration – including MTD for Income Tax Self-Assessment from 2023, investment in digital infrastructure, review of tax admin framework, timely payment, raising standards in the tax advice market and reducing Inheritance Tax reporting requirements
- Tackle non compliance – clamping down on promoters of tax avoidance, tackling disguised remuneration avoidance, off payroll working rules, no safe havens, tax conditionality and sanctions for illicit tobacco
- Further tax policy announcements – including a further review of business rates, aviation tax, strengthening the self-catering accommodation criteria for business rates, a review of the Office of Tax Simplification, residential property developer tax, dormant assets scheme expansion, pensions tax technical updates, tax treatment of superfunds, taxation of trusts, aggregates levy, landfill tax review, carbon emissions, notification by large businesses of an uncertain tax treatment, VAT grouping, partial exemption and capital goods scheme, new rules to prevent value shifting for VAT, VAT and the public sector, simplification of the land and property VAT rules, capital allowances for Structural and Buildings Allowance, transfer pricing documentation, securitisation tax rules and social investment tax relief
In addition to the overall policy document, more than 30 tax policy announcements and documents were issued, including responses to consultations, research papers and new consultations.
Craig Simpson, Tax partner at Bates Weston comments:
“Yesterday was a tax day focused on administration and tackling tax avoidance with a list of other tax areas that will be subject to consultation shortly. It is helpful to understand the direction of travel of government tax policy but it doesn’t feel too much different to the normal approach of issuing consultations on Budget Day.”
As usual, our tax team will be examining all documentation as it is released, gathering input and contributing to the consultation process as relevant.