Book Description

The House of Lords Economic Affairs Committee reports on aspects of the Government's taxation plans before the House of Commons again discusses this year's Finance Bill at Report Stage. The Committee, which brings together economic and financial experience from business and politics, points to four main areas for Government attention: tax policy; scrutiny; tax avoidance and evasion; and corporation tax reforms. The Government must stick to its own commitment to a new, consultative approach to tax policymaking if it is to achieve its aim of giving the UK the clear, stable and predictable tax system which it needs to be competitive. The Government's new approach is welcomed but has so far not been implemented consistently. The Government's failure to consult on the increased charges on oil and gas production it announced in the Budget was criticised for putting investment in the oil and gas industry at risk. Many witnesses called for earlier Parliamentary scrutiny of the Finance Bill measures. The Government must act earlier to curb tax avoidance and evasion. The Committee criticises proposed legislation against "disguised remuneration" for tackling the problem too late and for being excessively long and complex. The Government should consult earlier so that it can put forward better Finance Bill legislation. The Committee also calls for the Government to develop a strategy to tackle tax evasion. The Government should monitor its corporation tax reforms to make sure that they do not accidentally disadvantage particular groups, for example small and medium-sized businesses.