In its Spring Budget submission to the Chancellor, ICAEW said that investment in HMRC should continue until its services improve, with incentives to drive performance, which has been beset with long-running delays. ICAEW said that current performance measures at HMRC should be reviewed to ensure they drive the right behaviours.
In addition, ICAEW called on the Chancellor to deliver a strategy for a modern, simplified and digital tax system. In particular, tax simplification is essential if the government is to promote growth, ICAEW said, while a review of VAT recovery rules on certain imported goods could aid growth and business productivity. [1]
The Institute’s submission provides a set of recommendations to fix issues in the tax system, strengthen the public finances and show bold leadership on the green transition. With anaemic economic growth, high levels of public debt and high interest rates, the Budget comes at a difficult time for the UK economy, the submission added.
The Budget was also an opportunity to strengthen the UK’s public finances at both national and local levels, ICAEW said, with the creation of a Budget Committee to provide a forum for government and parliament to discuss short-term priorities and long-term strategies.
Additionally, ICAEW called on the government to use the Budget to show bold leadership on net zero and financing the green transition. This includes a net zero investment strategy, close consultation with industry to minimise the administrative burden of the carbon border adjustment mechanism levy, and the creation of a new private-public partnership with the UK Infrastructure Bank to share the risk and reward of green infrastructure projects.
Michael Izza, ICAEW Chief Executive, said:
“As we approach the end of this parliamentary cycle, the government needs to prioritise the tackling of longstanding structural weaknesses that threaten to derail our economic potential.
“That’s why we’re asking the Chancellor to use the Budget to invest in and incentivise HMRC to end the delays that taxpayers and our members tell us about daily.
“In addition, we want the Budget to focus on the green transition and to strengthen the public finances to ensure the economy is fit for the future.”
In addition to the submission, Michael Izza wrote to the Chancellor to raise key points from the document.
ENDS
Notes to editors:
CONTACT: ICAEW media office stephen.froome@icaew.com or 07970 402 073
- This would review VAT recovery rules on imported goods that businesses did not own but had an economic interest in, such as leased items.