TaxAdministrationScrap the annual Budget, says ICAS

Scrap the annual Budget, says ICAS

Scottish institute says an annual Budget causes a short-term approach from government

ANNUAL BUDGETS cause short-termism from the government – instead they should take place at a minimum of every three years, according to ICAS.

Stability and certainty would arise from a longer-term budgeting process, it argues.

“A longer-term approach would encourage governments to set a clear strategy for the taxation system and avoid the political temptation of an eye-catching announcement every year”, said Derek Allen, director of tax at ICAS.

“If there is only one Budget every few years, changes to the taxation system outside that process may also attract a better level of scrutiny from MPs. At present, it is not realistic to expect many MPs to look in detail at 600-plus pages of legislation.”

The institute cites the U-turns taken by the chancellor on a number of issues announced in this March’s budget, including the ‘pasty tax’, static caravan VAT charge, the exemption of charitable donations from the £50,000 tax relief cap, as well as the fuel duty increase freeze.

“The UK tax law is too complex and lacks stability. If government is serious about promoting a stable tax regime, then annual change to the UK’s fiscal arrangements should be avoided unless it is vital for economic growth,” added Allen.

Related Articles

Brexit: Five questions accountants should be asking

Accounting Firms Brexit: Five questions accountants should be asking

1y Fraser Simpson, Reporter
Government should rethink “digitally distracted” HMRC, ATT urges

Administration Government should rethink “digitally distracted” HMRC, ATT urges

1y Fraser Simpson, Reporter
NAO report highlights lessons for HMRC’s future digitalisation plans

Accounting Standards NAO report highlights lessons for HMRC’s future digitalisation plans

1y Fraser Simpson, Reporter
UK leads charge for action on beneficial ownership

Administration UK leads charge for action on beneficial ownership

1y Fraser Simpson, Reporter
Cameron to announce new corporate offence for tax evasion

Administration Cameron to announce new corporate offence for tax evasion

1y Fraser Simpson, Reporter
‘Cause for serious concern’: Tyrie expresses Making Tax Digital fears

Administration ‘Cause for serious concern’: Tyrie expresses Making Tax Digital fears

1y Fraser Simpson, Reporter
Tax transparency plans adopted across Europe

Administration Tax transparency plans adopted across Europe

1y Fraser Simpson, Reporter
UK pressures OECD to tackle unhelpful tax jurisdictions

Administration UK pressures OECD to tackle unhelpful tax jurisdictions

1y Fraser Simpson, Reporter