ONE OF THE most interesting aspects of this Budget has been the new approach adopted by the government.
Back in the old days we never really knew what was going to come out until the chancellor stood up and gave his speech and then the all important Budget notes were released for scrutiny.
The previous Labour government improved matters and assisted by increasing consultation with tax advisers and industry but the current government has really gone one step further.
The old Budget notes have been replaced by Tax Information and Impact Notes (“TIINs”) which are published well in advance of Budget day, along with draft legislation upon which further consultation is made.
What is important is that the government is listening to those engaged in the consultation process.
Some changes have clearly been made for Budget day as a result of consultation on the draft legislation which was originally published in December 2010.
For example, the commencement date for the interim improvements to the controlled foreign companies regime has been moved forward. The new, advantageous regime will apply for accounting periods beginning on or after 1 January 2011.
When the law was first drafted, the commencement provisions were for accounting periods beginning on or after 1 April 2011 meaning that most companies would only benefit in their 2012 year due to having a calendar year end.
Another example is that the scope of the foreign branch exemption has been widened to include some life insurance businesses which were originally excluded.
While I may not agree with all of the policy that has been deployed by the government, I am certainly very impressed with this approach. Perhaps we finally have a government that has learned how to listen to advisers and industry on tax policy.
Kevin Hindley is managing director of Alvarez & Marsal Taxand UK LLP
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