TaxAdministrationMPs use ICAEW report to slam Revenue merger

MPs use ICAEW report to slam Revenue merger

Shadow cabinet ministers from both the Tories and the Liberal Democrats have used a report by the ICAEW's tax faculty to slam the government over progress made in the merger of the Inland Revenue and the Contributions Agency.

Link: Primarolo apologises for tax credits fiasco

In a Commons debate on national insurance legislation, paymaster general Dawn Primarolo was forced to flatly reject protests from MPs, based on the ICAEW report.

The new legislation aims to align power to obtain information investigating NIC and tax affairs and debt recovery on Inland Revenue lines.

The merger should also allow employers to ask employees to fund the employer’s secondary NICs liability on post acquisition earnings received from restricted and convertible securities – designed to encourage more employers to offer share-related bonuses.

But Primarolo came under fire from Tory shadow treasury minister Mark Prisk who said alignment of powers was welcome but did not go far enough.

He cited the report from the ICAEW’s Tax Faculty which said predicted benefits had not been achieved three years after the IR and CA were formally merged ‘and that performance of the merged NIC office had in that time deteriorated’ with forms becoming more complicated and problems arising in obtaining NICs advice.

Liberal Democrat shadow treasury minister Norman Lamb also welcomed the bill but highlighted the ICAEW criticisms over failure to reduce the burden on business, share experience, knowledge and skills, make better use of resources, achieve a joined-up approach and align tax and NICs rules.

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