Autumn Budget: Changes will create a more complex tax system

Following the Chancellor’s Autumn Budget this week, there are concerns that the changes put in place could create a more complex business tax system.

A tax system that is already stretched enough.

Small firms don’t have unlimited time or resources to keep pace with changing rules

This is according to the Association of Taxation Technicians (ATT). The professional tax compliance body believes that while a number of the changes may achieve policy aims, together they add up to an increase in complexity.

Commenting on this, Jon Stride, chair of the ATT’s Technical Steering Group, said, “Today’s announcements underline the growing challenge faced by taxpayers and advisers alike. Each of these measures may have its justifications when viewed in isolation, but the cumulative effect is a system that becomes harder to navigate year after year.

“Individuals and small businesses do not have unlimited time or resources to keep pace with changing rules. Greater simplification should be a priority for the Government, to ensure the system remains accessible, workable and fair, especially for individuals and small businesses who most struggle to comply.”

A ‘forest’ of small changes

The Recruitment and Employment Confederation (REC) shares these concerns and believes that these changes will result in employers who offer good pensions or train more apprentices suffering financially.

REC Chief Executive Neil Carberry, explained, “The Chancellor put growth at the heart of her speech, but there was too little in this Budget to get business investing.

“Alongside this, a forest of small changes will make our business tax system even more complex and raise more revenue from employers who do the right thing, such as offering great pensions or training more apprentices that their levy will pay for. Changes on tax credits for investors and employee ownership will make building and passing on a great small business more challenging.

“This lack of action sits alongside too little progress on key areas such as reforms to the Employment Rights Bill and ever rising costs of employment, driven by government decisions, that are causing a spike in redundancies over the past year.

“There are some areas of progress. Moves on Business Rates, short course access to skills levy funding and funding for employment support schemes. But all such steps require private sector support and engagement.

“The Chancellor went out of her way to mention investment in increasing NHS appointments but the Budget documents repeat the misleading claim that government is saving money with its attack on agency staffing. Like so much of this Budget, an approach that involves and engages the private sector would yield so much more, and help close the fiscal gap on the back of a more prosperous country.”

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