IT’S OFTEN SAID – and frequently by me – that the mainstream media and public require better education on tax issues, and that a great many misconceptions are regularly reinforced.
Basic misunderstandings – such as quoting turnover in relation to companies’ corporation tax bills – are incredibly common and contribute to widespread failure to understand tax issues at the most basic of levels. The result is huge numbers of people ill-informed. leading to frustration no matter your side of the fence.
With that in mind, the ICAEW’s report Taxing corporate profits: hard choices is, at face value, a welcome and helpful document that seeks to address those issues on a fundamental level – aimed not so much at tax experts as a wider audience, explaining the corporate tax regime and the way it functions.
Indeed, on closer inspection, that’s exactly what it is as far as I’m concerned, and the only thing it needs is greater dissemination.
However, it’s not without its critics, and tax blogger Richard Murphy was particularly vociferous, branding it an “exercise in obfuscation” and claimed it “den[ies] that transparency can offer any significant solution to this problem [of corporate tax avoidance]”.
Indeed, how this marries up with an institute that has stridently spoken out on treating aggressive tax avoidance as a potential disciplinary offence, is interesting in itself. It has to tread the line between supporting a membership that often provides relatively benign – but vital – tax services, against the egregious acts of some.
The ICAEW defended its position, explaining that disclosure often goes unheeded. Publishing the information does not necessarily – and it usually doesn’t – mean it hits home with much of the media or, indeed, the public.
Indeed, some of the accusations levelled against large companies has occurred after publically available information has been missed or ignored. The allegations of tax avoidance against Thames Water over its use of tax reliefs put in place for investment in infrastructure are one such example.
And therein lies the problem. Ensuring the correct information reaches people.
Still, at least the institute is doing its bit, and to ensure at least some of the right people read it – here’s the link.
MTD represents 'the single most significant change to the UK’s system of taxation in recent times', says Knill James partner Nick Rawson. So, how prepared are SMEs for digital tax reporting?
The SME community voices concern about the chancellor's measures in the Spring Budget
Following chancellor Philip Hammond’s Spring Budget speech, we explore the key takeaways for businesses and individuals
Unincorporated businesses under the VAT threshold given an extra year to prepare before MTD becomes mandatory