Archive for the ‘HMT’ Category

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Tax simplification and better regulation.

January 18, 2017

My PhD-in-progress asks the question whether using better regulation techniques produces tax simplification, a question to which the glib answer is, of course, “it would, if they did”. So in keeping with the Making Tax Policy Better report and the suggestion that this is just the start of a conversation, I have been wondering what progress we might make towards a simpler tax system by making better use of the tools we already have.

Look, for example, at the 51 TIINs published on 5 December to support the draft 2017 Finance Bill.  If you take these and put them into a spreadsheet, listing the three quantifiable fields (exchequer impact, administrative burden and HMRC costs) what do you find?

The measures fall into three crude categories.  Firstly, there are those measures whose overall impact will be greater than £100 million.  Insurance Premium Tax: increase of standard rate, for example, or Abolition of Class 2 National Insurance contributions.  The Chancellor must be allowed to determine how and where he raises the money he needs to fund the expenditure he incurs: decisions about these large measures is political, and we can leave them alone for these purposes.

Secondly there are the measures which have smaller impacts. Personal Tax: changes to bands for ultra-low emission vehicles in company car tax for example will raise some tax, save some admin burden and cost HMRC some money.  Personally if I were an MP debating the Finance Bill I would want these relatively trivial measures to balance out: I would only allow as many measures which increase tax by amounts less than £100m as there were measures which decreased tax or administrative burden by similar amounts.  I suspect if this balance were demanded, the number of such measures might significantly decrease.

Finally there is the category to which I would wish to draw your attention today.  There are fully twenty measures where, so far as I can see, the exchequer effect (the actual tax raised or foregone) is zero, and both the administrative burden on taxpayers and the cost increases or savings for HMRC are either nil or negligible.

The question then is – why the hell are we doing them?  Here is a random selection:

Tobacco Duty: Illicit Trade Protocol – licensing of tobacco manufacturing machinery is a provision to licence tobacco manufacturing machinery.

Co-ownership authorised contractual schemes: reducing tax complexity seems to be a tidying-up of capital allowance rules for operators of co-ownership authorised contractual schemes (CoACS) and their investors, and yet will have a “negligible” impact on the tax they pay or on their administrative costs.

Landfill Tax: definition of taxable disposal will affect approximately 150 specialist disposal firms in England (the tax is or will be devolved in Scotland and Wales) and they will “incur negligible on-going savings through the removal of the requirement to inform HMRC about certain non-taxable activities.”  (HMRC couldn’t have just written them a letter??)

The Treasury and HMRC have an easier ride than other Departments in getting legislation before Parliament: they do not have to bid for space in the legislative programme, and Finance Bills are counted as “money bills” and subject to an easier passage through Parliament as the Lords can only delay rather than amend them.  There is a broad definition of “money bills”  which includes one “which in the opinion of the Speaker of the House of Commons contains only provisions dealing with … the imposition, repeal, alteration, or regulation of taxation…”  Perhaps someone should have a word with John Bercow?  It seems to me that, were he to declare that in his opinion no measure which produces neither tax, administrative burden saving nor government cost saving was a provision regulating taxation… and therefore no Finance Bill containing such measures could be certified as a money bill…

…well, perhaps he might, at a stroke, become tax personality of the year for his services to simplification of the tax system?

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Better

January 17, 2017

Yesterday I was in London for the launch of the joint Chartered Institute of Taxation, Institute for Fiscal Studies, and Institute for Government report on improving tax policymaking.

The report, Better Budgets: Making tax policy better, is here. There are ten suggested steps towards making tax policy better, the first of which – moving from two to one fiscal event each year – has already been adopted.

There was an interesting discussion at the launch including a response from the FST and contributions from Andrew Tyrie from the Treasury Select Committee and Edward Troup from HMRC.  There is even video – fortunately I was sitting out of sight of the cameras so it’s safe to watch!

The report is described as being the start of a conversation and I have some thoughts about that which I’ll put together later this week if I can.  However the interesting part of the discussion yesterday was, for me, the comments Edward Troup made about widening the conversation.  Because there was a feeling of familiarity about the collection of people in the room yesterday: I found I recognised a fair number of people and there was talk about “partnership” – between politicians and tax professionals – in making the Budget in future.  And, yes, I was tweeting that this horrified me, because tax policy is too important to be left to the wizards.  We need to bring the tax muggles on board too.  I was charmed – and immensely pleased and relieved – to find Edward Troup arguing for the inclusion of the muggles too.  Kudos!

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Clearing the decks

March 15, 2016

It’s the day before the Budget. You would think that HMRC and the Treasury would have cleared the decks ready for the raft of new measures presumably coming towards us after the speech.

So I was rather surprised when a quick check of the “open consultations” tab on the gov.uk website brought up one outstanding HMRC consultation and four for the treasury.

The HMRC one is mildly interesting: “a consultation on the control of tobacco manufacturing equipment and possible licensing of those involved in the supply chain for tobacco products.” Woah, you might think: we’re going to have licensed tobacconists??? Turns out from reading the consultation document that there are already arrangements in place for tobacconists in Scotland, Wales and Northern Ireland to be registered: the issue for most of us will, I imagine, be how to get an equivalent process in place for England without on the one hand opening up a market in cross border arbitrage and on the other slapping an enormous administrative burden on some relatively marginal small businesses.

The four Treasury ones? The first two: Reforms to the investment bank special administration regime and Insurance linked securities are Letwin consultations. By Letwin consultations I am of course referring to Oliver Letwin’s explanation that the point of consultation isn’t to get “views” but to look for unintended consequences. No-one at the Treasury cares what you or I think about the investment bank special administration regime or about index linked securities. What they want from the consultation is for investment banks, accountancy bodies and major law firms to do some work for them on whether their proposals – whatever they are – work at all, work as intended, and will pass through parliament without annoying lobbying from the industries affected.

I sort of feel that, as this started as a blog looking at consultations, I really ought to read both consultation documents and attempt to form a view whether they are good proposals. I feel, however, that a Letwin consultation is designed to induce somnolence in the general reader, and I just don’t care enough today to even try, sorry.

I will reserve my indignation for the other two Treasury consultations. If you have the time and the inclination, I recommend looking at this one: the proposal to create a National Infrastructure Commission, or at least to put the “shadow” one that has already been set up onto a statutory footing.

This consultation closes on Thursday night (11.45pm 17th March) and asks, in effect, if we think it’s OK that the Treasury sets up a quango – sorry, that’s not politically correct these days, is it? Now we call them “non-departmental public bodies”. The Treasury will set up an NDPB which will produce a National Infrastructure Assessment (NIA) and do we agree that a GDP envelope would provide the most effective fiscal remit for the commission…

Can we imagine the post-war Attlee government setting up the National Health Service like this? The National Health Infrastructure Board would still be holding meetings to decide whether the GDP funding envelope would allow them to start building a hospital at some point in the not too distant future, if the existing providers didn’t mind too much and the government accepted their latest Health Infrastructure Advisory Report…

And the final Treasury consultation? They want to make public sector exit payments “fairer, more modern and more consistent”. In other words, they want to get rid of huge swathes of the civil service and they don’t want to pay the going rate for doing so. What? You thought any of those weasel words meant that they were suggesting consistent or modern fairness to their workers?

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More equal than others

December 8, 2015

How not to do equality impact assessment.

  1. Throw together a ragbag of things which might conceivably have a positive impact on women or people with disabilities
  2. Relentlessly ignore anything else, particularly anything which might have a negative effect on women in comparison with men.
  3. Do not, whatever you do, think about things in a joined-up way so that you look at the cumulative impact of a number of smaller changes.
  4. Publish, smugly.

Yes, HM Treasury, I’m looking at you.

Here, by way of a little light relief, is the women’s budget group’s analysis of the Autumn Statement and Spending Review.  I’m not sure what else to say, except Grrrr!  Argh!!

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State of play

September 16, 2015

So there are fourteen open consultations listed as relating to HMRC on the gov.uk website today.  If you filter instead for the “tax and revenue” policy area (all departments) the total comes up as 18 – four from the Treasury.  Query: why are some tax consultations badged from the Treasury and some from HMRC?  Answers on a postcard…

The first is a review of travel and subsistence rules.  It was published under the coalition government, in July 2014, but says that it closes at quarter to midnight on 1st May 2016.  I find this rather improbable, and I wish gov.uk would have a look at it.

You have until 30th September to respond on the taxation of performance linked rewards paid to asset managers, employment intermediaries and tax relief for travel and subsistence, ISA qualifying investments and crowd funding, and the IR35 discussion document

You need to get motoring to respond to the implementation of the Personal Savings Allowance and the deduction of income tax from interest in peer to peer lending which both close on 18th September.  The other handful all have closing dates in October.

But I could have read and perhaps responded to one of them in the time I’ve taken today trying to identify which one to prioritise.  Because apparently listing consultations with a visible closure date and/or in the order in which they close remains beyond the wit of a twenty first century government.  Or, as I said on Facebook yesterday, you’d almost imagine they didn’t want responses from Jo Public.

 

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Accessibility?

July 27, 2015

Don’t mind me; I seem to have reached the Grumpy Old Git stage of my convalescence.  This morning, for example, I thought I would read the Tax Assurance Commissioner’s new Annual Report – I know, I know, but there’s only so many episodes of Bargain Hunt and Time Team you can watch before your brain melts and dribbles out of your ears altogether.

Here it is: on gov.uk of course, on a page of “collections”, where the 2012-13, 2013-14 reports are collected along with the new one, for 2014-15.

Click on any of them, however, and you get the message that “This file may not be suitable for users of assistive technology”.  Now, wait a minute, wasn’t the government’s own website supposed to meet the government’s own standard for accessibility?  Why is the report a PDF document (which is a bugger to get to a reasonable size for comfortable reading) rather than HTML, which – as the government’s own Service Design Manual points out – is a more accessible option:

For written reports, the native format of the web (HTML) should be your default option. PDF can be an excellent display format, but without additional effort it can be inappropriate for users of screenreading software.

A pdf document should only be used where there is “no other option“:

HTML is quicker, easier and more widely usable/accessible than PDF, but where no other option is possible this PDF guidance should be followed.

I’m lucky enough not to require use of specialist software to read this document: I’m just pissed off that the text shows up on my laptop in a font too small for me to read comfortably without a lot of fiddling about, and that it took me a good ten minutes to find the control to increase the magnification.

But I wonder why there are so many HMRC and HMT documents which pop up as PDFs instead of HTLM.  Is there really “no other option”, or is there a default to seeking an easier life and not worrying about it till someone makes a fuss?

Answers on a postcard…

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A new day

May 7, 2015

Well, election day, actually.  I’ve been and voted, and now I’m ready for a marathon night watching the results.  I know, I know, I’m sad like that; and, of course, I’m semi-retired so I don’t have to be anywhere tomorrow so I can sleep in as long as I like.

You would think, in the hiatus between governments, that all would be quiet on the consultation front.  I logged on to gov.uk out of sheer curiosity, thinking it would be interesting to see the consultation page with the counter set to zero.

But no!  There are, in fact, some 62 open consultations listed.  I don’t know about you, but I feel that 62 new laws and regulations would be a reasonable score for an entire parliamentary term, not the number of residual bits of leftover legislation not important enough to wait for the end of purdah.  Can we just STOP making new law and try administering the ones we’ve got for a bit?

Sigh.

Of the 62 open consultations I have no objection to odds and ends of measures like Natural England consulting on restricting access to, for example, Widdybank Fell (which looks very nice, by the way).  The world would still continue turning even if we didn’t have a government, (Belgium managed OK for 541 and then 135 days, after all) and so I suppose there’s no reason to stop the process of consulting.  But I could have lived without seeing a serious consultation into reform of the Government Ombudsman service, a paper on what I suspect is the first salvo in the war of the next BBC licence fee and a call for evidence on creating a secondary market in our bloody pensions sliding quietly out while all our backs are turned to the polling station.

Anyway.

HMRC has five open consultations:

and the Treasury has eight, two of them also on the HMRC list, five which (from a quick look, anyway) aren’t connected with tax, and one which may be of interest: Travel and subsistence review.  But which closes on 1 May 2016 at 11:45pm.

2016? Seriously?  I suspect it should read 2015 and it’s an already closed consultation.

It’s the twenty first century.  Keeping and maintaining an up to date list like this shouldn’t be this hard, surely?

Dear New Government: please get someone to make gov.uk work.  Thanks.