CIOT Criticises Complexity Of UK Tax Code

by Robin Pilgrim, LawAndTax-News.com, London

22 July 2003

In its representation regarding the 2004 budget, sent to government and revenue departments on Friday, the UK's Chartered Institute of Taxation (CIOT) has slammed the complexity of the country's tax law, and the increasing reliance on secondary legislation to correct mistakes and omissions in the tax code.

The CIOT explained that tax legislation is often inadequately scrutinised prior to enactment, meaning that: 'subsequent amendment, or publication of Revenue concession or practice (is necessary) to make it workable.'

The Institute went on to add that the complexity of the UK's tax laws presents a major threat to its competitiveness, in addition to increasing the compliance burden for companies which choose to locate here.

'Most corporation tax payers were already wanting a period of stability last year after a period of rapid and substantial change, even though much of the change was welcome: eg the intangible fixed assets rules, the debt and derivatives rules and the relief for gains on substantial shareholdings,' the body announced in its budget submission, continuing:

'However, it is recognised that further changes may well be required to deal with ECJ decisions and developments in accounting standards. These should be the priorities for space in the 2004 Finance Bill and any preparatory consultation.'

The CIOT also called for simplification of the personal and indirect taxation regimes in the United Kingdom, reiterating its call for the creation of an Indirect Taxes Management Act.

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