STEPHEN COLECLOUGH has a lot to fit into the next year.
The new president of the CIoT has set his sights on improving the UK’s approach to Europe, broadening the institute’s education provisions and engaging further with the ongoing public debate on tax.
With tax dominating the headlines more than ever on both domestic and international levels, and misconceptions still featuring prominently in the mainstream media, Coleclough certainly will not be short of issues to address.
Having taken the institute’s reins in May, Coleclough has moved to act on what he describes as the UK’s “slapdash approach to Europe”.
“Without doubt, it is clear that a lot of our tax provisions contravene European law. If you look at the last Finance Bill, there are a number of instances where Britain has been taken to court – or threatened with being taken to court – where the government has said we are now complying with the European rules. But they’re not, and we’ve said they’re not.”
The issue, says Coleclough, is the UK’s reluctance to draft new laws, preferring instead to build on out-of-date, existing ones.
The result is an incoherent mishmash of tax laws, neither compliant with the European charter Britain signed up to, nor truly serving the country well either.
“What they [the government] do is they look at provisions they’ve got and, starting from the wrong place, tweak them a little bit as close as they can [to the EU requirements], without giving up the old principles.”
Those critical of such a stance often brand it as naïve idealism and suggest making such a move would prove too costly for the Treasury. Not so, says Coleclough.
“I think you can get to be EU-compliant, but it’s very hard to get there by tinkering and layering upon layer of existing anti-avoidance rules,” he says. “We would do better to say ‘this anti-avoidance rule is there because we want to catch this type of activity, how do we catch that in an EU-compliant way?’, rather than saying ‘this is what we’ve got, if we just tweak it, it’ll be all right’.”
Of course, there are a great many who – understandably for some – simply don’t want to be EU-compliant, and in some cases would prefer to be outside the union altogether.
Coleclough, though, has little time for that argument. “We are in Europe. We’ve been in Europe for 40 years. Get over it,” he says wryly.
The key, then, is for the CIoT to engage with government not just on a domestic level, but also on an international level.
And as it happens, that is precisely what Coleclough is looking to do.
To that end, he is looking to take the CIoT’s educational role to the European Commission.
“If you put yourself in their shoes, they’re sitting in offices in Brussels. Why should they know about the UK tax system? They don’t. The only official point of contact they’ve got is with HMRC, which may or may not provide the engagement they want,” Coleclough notes.
While the institute cannot shape policy, the body will continue to lobby just as it has done in the past, making complaints where appropriate, and educating not only tax advisers, but the public and government as well.
Those actions, it is hoped, will help inform the public debate, which in the eyes of many in the profession has become distorted and highly emotive, particularly where tax avoidance and the taxation of multinational companies are concerned.
Much of the debate has been fuelled by aggressive tax avoidance schemes, profit shifting by multinationals such as Google, Amazon and Starbucks, and hearings held by the Public Accounts Committee.
The latter, perhaps, has done the most to keep tax in the news, regularly criticising multinationals and wealthy individuals for their low tax bills, while also taking aim at HMRC for its handling of such cases.
Quite apart from the widespread questions over the committee’s remit on tax – many feel it’s something more appropriately analysed by the Treasury Committee – Coleclough harbours concerns over the profession’s voice in the debate.
“Advisers worry about being told ‘you would say that, wouldn’t you?’, and often the message of people like John Whiting is ignored because it’s not sexy enough,” he says.
Despite the arguable imbalance in the discourse, the president is pleased the public is taking a healthy interest in tax, with concerns over the system’s effectiveness in the 21st Century pushing it up the agenda.
Indeed, the continuing public discussion is the biggest issue for the industry currently, he admits, although the image of the tax profession will not emerge unscathed from the fray.
“People are more aware than ever of tax advisers helping multinationals develop in a tax-efficient manner legally,” he explains. “But the rules are the rules, and companies can’t act unilaterally to change them.”
That, it seems, is what the debate boils down to, and as far as the CIoT is concerned, its role in explaining how the tax system works and why particular rules are in place is imperative if the public is to receive the answers it needs.
That, Coleclough says, is hugely important if people are to realise the system is not as broken as they might be led to believe.
HMRC's customer service has been slammed by the NAO, with critics adding that taxpayers have been "short changed" by the government department
IPA issues first personal insolvency licence after licensing regime opended to greater competition
The search engine's tax affairs have come under further scrutiny following a dawn raid on its Paris offices
Law Society claims that the public interest cannot prove to have been served by the ICAEW's move into probate - and as such should not be used by the institute as evidence to back its push into further legal services