Government warned over rushed bill

Government warned over rushed bill

Experts fear general election may cause uncertainty in new tax legislation.

Last month’s publication of the finance bill revealed a raft of new measures to clamp down on tax avoidance, but accountants have warned the government that it could result in a ‘flight from certainty’ in terms of tax legislation.

With a general election just around the corner, tax experts have expressed concern that there will be too little time to properly scrutinise the bill in detail, leading to unwieldy and incorrect tax legislation being introduced.

Ian Hayes, chairman of the ICAEW tax faculty technical committee, warned the Treasury that it must keep to its ‘normal and proper practice’ of publishing a shortened bill to allow for collection of taxes.

Other measures should be revisited after the election, he said. ‘We are concerned that there are a number of items in the bill that the government, at the behest of HM Revenue & Customs, will want to push and get through, particularly in the form of avoidance measures,’ said Hayes. The ICAEW has written to the paymaster general expressing its concerns.

The ICAEW pointed to several aspects that could lead to controversy and claimed that aspects of the anti-avoidance provisions could be in ‘potential breach of the EU Treaty’. It also claims some of the legislation could catch innocent transactions and that not enough time will be available to ‘properly digest’ it. ‘This could lead to a flight from certainty in terms of tax legislation with the details being added in secondary and even tertiary legislation,’ said Hayes.

Andrew Green, tax partner at Mazars, pointed to the irony of Gordon Brown’s Hampton Review announcement to cut red tape and bureaucracy. ‘At least 31 clauses are concerned with anti-avoidance proposals – the very thing that increases red tape,’ he said.

Paymaster general Dawn Primarolo published the bill on 24 March and it contained some of the most complex legislation in government. ‘Today’s finance bill introduces important measures to promote fairness and tackle tax avoidance,’ she said at the time.

Share

Subscribe to get your daily business insights

Resources & Whitepapers

Why Professional Services Firms Should Ditch Folders and Embrace Metadata
Professional Services

Why Professional Services Firms Should Ditch Folders and Embrace Metadata

3y

Why Professional Services Firms Should Ditch Folde...

In the past decade, the professional services industry has transformed significantly. Digital disruptions, increased competition, and changing market ...

View resource
2 Vital keys to Remaining Competitive for Professional Services Firms

2 Vital keys to Remaining Competitive for Professional Services Firms

3y

2 Vital keys to Remaining Competitive for Professi...

In recent months, professional services firms are facing more pressure than ever to deliver value to clients. Often, clients look at the firms own inf...

View resource
Turn Accounts Payable into a value-engine
Accounting Firms

Turn Accounts Payable into a value-engine

3y

Turn Accounts Payable into a value-engine

In a world of instant results and automated workloads, the potential for AP to drive insights and transform results is enormous. But, if you’re still ...

View resource
Digital Links: A guide to MTD in 2021
Making Tax Digital

Digital Links: A guide to MTD in 2021

3y

Digital Links: A guide to MTD in 2021

The first phase of Making Tax Digital (MTD) saw the requirement for the digital submission of the VAT Return using compliant software. That’s now behi...

View resource