CIoT welcomes Scot’s tax law despite missing adviser details

THE CIoT has welcomed the passing of the Revenue Scotland and Tax Powers Bill by the Scottish Parliament, but warned it still lacks detail around tax advisers’ duties.

A number of tax powers have already been devolved to Scotland since the passing of the Scotland Act in May 2012, but the passing of the latest bill has permanently changed Scotland’s tax landscape regardless of the outcome of the Scottish referendum.

“This demonstrates growing confidence in Scotland’s capacity to manage its own tax affairs, said Moira Kelly, chair of the CIoT’s Scottish technical sub-committee. “Scotland now has its own tax authority, firmly established in law.”

“Positive changes” were made during the passage of the latest Bill, but details of what is expected of advisers was vague.

“A more balanced tone in the framework for a charter clarifying behaviour expected of both taxpayers and Revenue Scotland, has been struck. Language has been tweaked where there were formerly ambiguities,” Kelly said.

“Some disappointments remain though, including a lack of detail on the rights, duties and obligations of agents and advisers.”

Tax rules regarding penalties, for example when they apply and what they arise in respect of, were not originally included in the primary legislation but now are.

“These are the fruits of a sound consultative process where concerns have been listened to,” she added.

The Scotland Act 2012 gives the Scottish Parliament the power to set a Scottish rate of income tax to be administered by HMRC for Scottish taxpayers. It is expected to apply from April 2016.

The Act also fully devolves the power to raise taxes on land transactions and on waste disposal to landfill – it is expected that this will take effect in April 2015, at which point the existing Stamp Duty Land Tax and Landfill Tax will not apply in Scotland. The Act also provides powers for new taxes to be created in Scotland and for additional taxes to be devolved.

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