Revenue strips out ‘confusing detail’ in direct tax law rewrite

The Inland Revenue’s five-year project to rewrite direct tax law may emphasise why the law exists, in a bid to make it easier for taxpayers to understand.

In its second technical discussion document, the Revenue has outlined five purposive techniques which could be used to make tax law easier to understand. It stresses it is not suggesting abandoning detail, just expressing principles, ‘to avoid the process of examining tea leaves’. Techniques suggested include:

– EU-style drafting: law flows from high statements of principle, and from ‘recitals’ which state what regulations and directives are meant to achieve;

– Statements of purpose: superimposed on to legislation at any level;

– Supplementary material: ‘the confusing mass of detail’ would be stripped out;

– Shorter primary legislation; and

– Revenue statements of practice covering missing detail

Dawn Primarolo, financial secretary to the Treasury, said: ‘The project aims to bring clarity to our direct tax legislation, making the tax system more accessible to taxpayers and their advisers.’

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