Treasury chief Ellison pledges ‘steady, predictable tax regime’

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Jane Ellison, financial secretary to the Treasury, has pledged to maintain ‘a steady, predictable tax regime’ and states that there is a need for practical changes to increase certainty, in response to a debate within the accounting profession over how tax policy is best developed

Ellison’s comments were made at an event following publication of a report by CIOT, the Institute for Fiscal Studies and the Institute for Government, which concluded the current process is not fit for purpose.

She said the report and other comments made it clear there was a need for ‘sensible, workmanlike adjustments that provide certainty – or indeed no change at all if that’s the wisest course’.

As evidence of a new approach in government, Ellison cited the abolition of the Autumn Statement, which was in line with the group’s earlier proposals.

‘From 2018, there will be just one major fiscal event a year, when the Budget is presented in the autumn.

In the spring, we will give a statement in response to the OBR’s forecast – in line with our legislative commitment to present two such forecasts to Parliament each year.

We may also highlight longer-term fiscal issues, or launch consultations. And there would be the opportunity to make changes if there were a compelling reason to do so,’ she said.

Ellison said it was important to reserve the right to make changes given ‘a period of inevitable uncertainty’ during Brexit negotiations. However, the aim was a ‘strategic and considered’ approach where issues are raised in the new Spring Statement, set out as specific proposals at Budget, with a period of consultation resulting in most legislation being enacted around the start of the new tax year.

Ellison said the government would also be doing more to signal potential areas of future taxation changes, saying that an early example of how this would work was when HMRC highlighted salary sacrifice schemes as a focus before last year’s Autumn Statement took place.  Another upcoming area of interest is how taxation maps on to different ways of working, from self employment to incorporation.

Ellison said: ‘I’m in full agreement with the report on the enormous value of being clear and open about the direction of travel – both for the sake of those making plans on the basis of our policies, and for the sake of developing better policies in the first place.’

On the question of having the right levels of expertise within government, Ellison for the first time the Treasury is offering full sponsorship for staff to gain the professional tax qualifications including becoming a chartered tax adviser, or to taking the ATT exams, with the initial cohort due to begin training next month.

Saying ‘what I think we have to recognise is that, for taxation policy to really be well developed, it requires a genuinely collaborative group effort’, Ellison pledged to listen to ‘expertise beyond government’, including from the professional institutes.

Ellison concluded by reaffirming HMRC’s commitment to digital working, as a way of addressing previous concerns over poor customer service levels, saying she also wanted to improve the transparency around HMRC’s performance in the future.

Ellison’s speech is here.

Pat Sweet | Reporter, Accountancy Daily [2010-2021]

Pat Sweet was the former online reporter at Accountancy Daily and contributor to the monthly Accountancy magazine, pub...

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