The Chartered Institute of Taxation (CIOT) has welcomed the UK Government's decision to remove a majority of the Finance Bill following discussions with the Opposition, reports Tax News.
The Institute has called for the Government to make a clear statement about whether (if re-elected) all of the clauses dropped will be reintroduced on the original timetable.
The Government has decided to delete 72 out of 135 clauses and 18 out of 29 schedules. The residual Bill has been estimated to be roughly 140 pages in length compared with the current 762 pages, a reduction of more than 80 percent by volume.
This is in line with a call by CIOT in a letter to the Chancellor, copied to the Shadow Chancellor, sent on April 19, in which CIOT President Bill Dodwell warned of the risks of rushing through a large number of tax changes without any real parliamentary scrutiny.
Clauses dropped include those on Making Tax Digital, corporate loss relief, and interest deductibility, VAT in relation to fulfillment houses, and penalties for enablers of defeated tax avoidance schemes. It is likely that most if not all of the provisions dropped will return in a Bill after the election, regardless of who wins the election, CIOT said.
Under Making Tax Digital, the Government will require taxpayers with a turnover exceeding GBP10,000 (USD12,370) to maintain digital accounts on a quarterly basis.
CIOT President Bill Dodwell commented: "This is a sensible, pragmatic approach from the Government and Opposition. Agreeing to leave most of the complex and controversial clauses in the Finance Bill until a post-election Finance Bill where they can be scrutinized at greater length."
"As we said in our letter to the Chancellor, this is not simply about the formality of parliamentary debate. Since the Finance Bill was published last month, we have identified a number of changes that we believe are needed to the legislation on areas including in complicated areas such as loss relief and interest deductibility. Delaying this legislation until the summer will hopefully allow time for our concerns to be looked at and taken on board by government."
"We particularly hope that the delay in legislating for Making Tax Digital will enable more of the framework for this huge project to be put in statute, rather than brought in through regulations, which are subject to less scrutiny and unamendable."