Practice - Brown stands firm on plans
Chancellor Gordon Brown has admitted receiving a flood of protest over proposals to end cash-based accounting for income tax for partnerships.
He told MPs: ‘The Inland Revenue has received a large number of responses and had a series of meetings with representative bodies, including the Law Society, the Bar Council and accountancy bodies.’
Consultations on the controversial proposals, which could cost firms thousands of pounds, ended last week.
Despite the strength of opposition, Brown appeared to be standing firm, but the Revenue has agreed to exclude ‘success fee’ work from its plan’s to tax work-in-progress.
Brown made it clear in the Commons that proposals for a phasing-in period, including a ‘catch-up’ tax charge, would allow the change to take place with sensitivity – despite representations to the contrary.
Brown said: ‘The proposal is that those in professional bodies should be taxed in the same way as everybody else.’
Tory accountant MP Nick Gibb said: ‘The proposal has been ill thought through.’