How effective has the Office of Tax Simplification (OTS) been in making suggestions to simplify the UK’s tax system and what more could be done in future? ICAEW’s Tax Faculty outlines HM Treasury’s review of the OTS and how you can contribute.
The UK tax system is complex, but since the Office of Tax Simplification (OTS) was established on 20 July 2010, with its role to identify areas where this complexity might be reduced, there has been hope that things might be getting better. But has the OTS delivered and is it even possible to hold back the tide, never mind put it into reverse?
The Finance Act 2016 requires HM Treasury to conduct a review of the effectiveness of the OTS every five years. The first five-year period ends on 28 November 2021 and a call for evidence for this review has just been launched.
The review will not only examine the effectiveness of the OTS over the past five years, but it will also consider what further steps should be taken to enhance the effectiveness of the OTS in future.
The OTS does not work alone and draws many of its suggestions on how to simplify the tax system for business and individuals, from the tax and legal professions. Its work is intended to help make the UK the most competitive country in the G20 and to reduce the complexity of the tax system.
The scope of the review is to examine the effectiveness of the OTS in advising the Chancellor on tax simplification, and also to consider what further steps should be taken to enhance the effectiveness of the OTS in future.
It should also give consideration to:
- the OTS’s objectives and functions in Finance Act 2016 and the OTS Framework Document;
- the resourcing, funding and governance of the OTS;
- the OTS’s relationships with HMRC and HM Treasury;
- the OTS’s work to date, including Chancellor-commissioned and original reports; and
- the impact of the OTS’s work on the government’s approach to simplification and on wider public debate.
The OTS will also welcome ideas and suggestions for what further steps should be taken to enhance the effectiveness of the OTS in performing its functions as the Chancellor’s independent adviser on tax simplification.
A full index of previous OTS reports and corresponding government responses shows how much ground has been covered since 2010. The call for evidence closes on 6 July 2021.
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