Tax incentives – the start of a debate? The tax community has long been exercised about the differences in taxation/NI between the employed and the self-employed. In 2010, the IFS’s Mirrlees review recommended reducing the distortions by moving towards greater neutrality. By the time the review was published, the distortion had been exacerbated by an … More Tax and the Taylor Review
Back in 1988, the economist Larry Summers explained why the US had no VAT: ”Liberals think it’s regressive and conservatives think it’s a money machine. If they reverse their positions, the VAT may happen.” Nearly 30 years later, the US still doesn’t have a VAT. But recent tax reform proposals by the Republican party would bring … More US tax reform: badly needed, but is the destination right?
One answer to that question might be “when it’s a probate fee”. The government has announced a new regime for probate fees, linked to the value of estates, which will replace the current fixed fee from May this year. Instead of the current £215 (or £155 through a solicitor), executors will pay on a sliding … More When is a tax not a tax?
At the Autumn Statement in November, the Office of Budget Responsibility (OBR) seemed to betray a certain frustration with the lack of information available about the government’s plans for Brexit. As I noted in my blog, flagging up a change in the OBR’s remit, the OBR confessed in its Economic and Fiscal Outlook (EFO) to … More The dog that didn’t bark in the Budget
The government’s response to the consultation on “Making Tax Digital” – requiring businesses to keep digital records and make quarterly updates to HMRC – was published this week, together with draft legislation. But, rather like Theresa May at a press conference, the government doesn’t answer some of the big questions. Businesses, agents and rep bodies … More Making Tax Digital: fundamental questions remain unanswered
Last Thursday’s FT carried an intriguing story about a German tax avoidance scheme with €billions at stake: the so-called “cum-cum” dividend-stripping device. While we generally think of the Germans as highly disciplined, this looked like an example of complete chaos. And the aggressive artificiality of the scheme took me back to the dark ages of … More Scandal in Frankfurt: tax avoidance pays dividends for German banks
The Office of Budget Responsibility (OBR) has been the subject of much comment since Wednesday’s Autumn Statement. But the fact that its remit has been changed seems to have passed largely unnoticed. Tucked away among the hundreds of pages of supporting documents is a revised draft Charter for Budget Responsibility. The charter fulfils a dual … More OBR can no longer shock us
Once upon a time, in a pre-Brexit, pre-Trump world, a conservative government unexpectedly won an election. One of their key priorities was to eliminate the deficit, and in the Budget immediately following the election they came up with a way to “raise” a few £billions by what amounted to an accounting trick. They decided to … More Smoke and mirrors don’t fill the deficit
The Supreme Court delivered an outstanding judgement on 19 October in R (on the application of Ingenious Media Holdings plc and another) v Commissioners for HM Revenue & Customs. The case related to an interview given on 14 June 2012 by the Permanent Secretary for Tax in HMRC, Mr David Hartnett, to two financial journalists … More The Supreme Court: confidentiality matters
With the summer finally coming to an end, I made time this week to look at one more of the tax consultations issued in August: HMRC’s Bringing business tax into the digital age, part of the Making Tax Digital programme. These proposals, requiring businesses to keep records using digital tools, have generated a significant amount … More Why, how and when? Some fundamental questions on HMRC’s proposals to Make Tax Digital