Institutes – ICA: tartan tax ‘too complex’

The Inland Revenue’s first proposals for the Scottish variable rate, the so-called tartan tax, have been heavily criticised by the English ICA for being ‘too complicated’.

The institute objected to the Revenue’s proposed powers to introduce tax charges by regulation and expressed concern at the complexity of the tax, which it said would lead to compliance costs out of all proportion with the likely yield of #450m.

‘Further consultation is required in order to ensure the tartan tax is satisfactory, otherwise the credibility of the tax will be undermined,’ said Frank Haskew, technical manager for the institute’s tax faculty. ‘Because this is a new tax, it’s an ideal opportunity to demonstrate that tax rules can be written in a clear way, so we believe that the legislation for the tartan tax should be written in plain English.’

Haskew added: ‘We are also opposed to yet more powers being granted to the Revenue to introduce tax charges by way of regulation. The imposition of taxes should be done openly through parliament, not secretly by the tax authorities.’

A Revenue spokesman said: ‘The government is continuing to consult all interested parties on the proposals and is keen that all views are put forward.’

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