The tax administration framework: supporting a 21st century tax system - summary response

The Government has published a summary of responses to its Call for evidence: the tax administration framework: supporting a 21st century tax system.  The tax administration framework refers to all legislation, guidance and processes relating to how HMRC collects revenue and makes payments.

The respondents made a number of observations, but these appear to the ones that are of most relevance to our sector:

• There was overwhelming support from respondents for changes to simplify the tax administration framework and reduce administrative burdens for individuals and businesses.
• Many respondents felt that greater certainty and clarity were key factors in building trust.
• Some respondents highlighted the need for guidance to be clearer and broader so that all taxpayers are aware not just about their obligations, but also about the claims and reliefs to which they may be entitled.
• Many were also in favour of using the Tax Administration Framework Review to support digital reform to build a modern, digital tax system that is adaptable, resilient and responsive.

Ther are a few interesting comments from HMRC:

• HMRC is engaging with the Australian Taxation Office on their approach to modernising their tax framework and transitioning to a digital system, and to understand their legislative underpinning. (P14)
• HMRC will continue to engage with other tax authorities … particularly countries with similarly complex tax codes to the UK who have taken steps to modernise and simplify their tax administration. (P14)
• HMRC will consider how to make better use of data from third parties to ensure that taxpayers are aware of their obligations to register for tax, and the use of nudges, prompts and educational communication. (P18)
• The Government believes that information, and particularly real-time information, is at the core of an effective and modern tax system, …HMRC will consider options for reforming information powers, including to make better use of third-party data sources, as a key element of the review’s future programme of work. (P27)
• The Government agrees with respondents that paper-based returns and ‘wet signature’ requirements should not form a routine part of a reformed framework. (P27)
• HMRC is working with the Guidance Forum to inform its strategic priorities for guidance improvements, including the further use of interactive decision-based guidance and online videos, and collaborating with external experts to help make HMRC’s guidance as useful as possible. (P37)
• HMRC will develop a roadmap for future consultation and analysis, working with stakeholders to ensure this review balances careful, incremental reform with ongoing support for the Government’s 10-year vision for the tax system. (P41)

If you have any questions, please contact Andrea.