Marissa Thomas, head of tax at PwC, said:
“The consultations published today underline the Government’s desire to make better use of technology not only to simplify the tax system but also to help close the £31bn annual tax gap. The current tax administration system is made up of a patchwork of different processes - almost every area of tax has its own set of rules. The challenge now is to unravel decades of tweaks and changes, which have each added their own layer of complexity.
“There is an opportunity to bring real simplification and modernisation, which will benefit both HMRC and taxpayers. It won’t be easy to deliver that simplification, but if HMRC work closely with the taxpayer and professional communities, it should be possible to develop a framework which works for all parties and builds on the technological changes which we are seeing.”
Commenting on the publication of a summary of responses to the call for evidence of the review of business rates, Phil Vernon, head of rating at PwC, said:
“In general, the responses have highlighted the strengths of a stable form of local taxation and how the system could be improved, while acknowledging that the overall burden of business rates needs to be reduced. The summary of responses highlights the general support for simplification, reviewing the system of reliefs and making the system more responsive to changes in the property market through more frequent revaluations. Making better use of technology to improve efficiency is also a key theme in the reform of business rates.
“The suggestion of a replacement land value tax received little support and there was a recognition that introduction of an online sales tax would have some benefits but equally would produce many new challenges. As retail is traditionally a low margin business there is a risk that any new tax is passed straight to consumers.”
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