Opinion Former Article

Be brave on tax simplification, new Institute President encourages politicians

In his inaugural speech as President of the Chartered Institute of Taxation (CIOT), John Preston will today encourage whichever government is elected on June 8th to be prepared to be brave on tax simplification.

Speaking at the CIOT’s annual general meeting this afternoon he will also:
·         Set out how the Institute is improving its offering to members, students and their employers, including a comprehensive exam review;
·         Float the idea of a commonly agreed baseline of standards of behaviour for tax professionals internationally;
·         Criticise government for not doing enough to help taxpayers on low incomes understand and engage with the tax system;
·         Warn of continuing concerns about the way that the Making Tax Digital programme is being implemented.

In addition to John Preston becoming President, Ray McCann today becomes Deputy President and Glyn Fullelove Vice President of CIOT.1

On tax simplification John Preston will say:

“Whichever party wins on June 8th, we hope they take seriously the unquestionable need to simplify the UK tax system… Whilst the OTS has achieved a great deal under John [Whiting]’s leadership and, I’m sure, will continue the great work under his successor Paul Morton, it must feel at times that they are fighting with one hand tied behind their back with the Government deciding certain reforms are simply politically unacceptable. Clearly that is Government’s call, but my personal view is that they may be underestimating what the population may be prepared to consider if the matter was properly explained to them. It was certainly encouraging that they were so warm in their welcome of the Better Budgets report”.

He will outline developments on the exam front:

“[I]t is fundamental that we have a set of examinations that are seen by all as being of the highest standard and which develop the relevant technical skills and knowledge for the many and varied tax related roles that people undertake… I am therefore extremely grateful to a past President, John Beattie, who has been leading a comprehensive review of our entire exam system to ensure it is as relevant as possible to the needs of today’s tax professional. Details of those changes will be announced later this year after they have been approved by Council… Similarly, we are also looking again at our international qualification… ADIT continues to be incredibly successful with nearly 600 existing graduates and over 2000 students from over 100 countries. Despite this success, we feel we might be able to do even more with ADIT and depending on how matters develop, we hope to put proposals to Council over the next 12 months.”

On improving the offering to members he will say:

“[W]e continue to look for opportunities to enhance the bonds that tie us together and help people develop their networks. To that end, we are looking in detail at the operation of our conference programme and very successful branches network to see if we can be even more attractive to all categories of members. This includes, in particular, those who do not work in professional practice such as those in industry or who work for HMRC, and those members who have only recently joined our profession.”

John Preston has already been taking a leading role in the CIOT’s international work. He recently reported to the House of Commons Treasury Committee on how the UK and Australian approaches to tax digitalisation compare. In his speech he will float the idea of a commonly agreed baseline of standards of behaviour for tax professionals internationally:

“Of course, the focus on the conduct of tax professionals is also not limited to the UK and we have been sharing the experiences which led to our revising our PCRT rules with a number of overseas institutes and others. Whilst it would clearly be impractical to expect our PCRT rules to be appropriate in their entirety in other countries given cultural differences, we are just beginning to consider whether there could be some minimum agreed standards of behaviour that apply everywhere. These would almost certainly be way below the standards expected in countries with highly developed tax systems such as the UK but it may nonetheless have some value. For example, take disclosure. I would have thought a principle broadly along the lines of “no tax planning should rely for its effectiveness on a Revenue Authority having less than full facts” might be something that could be acceptable regardless of the country from which one practices? This may fall into the too difficult box but we think it may be worth some high-level consideration.”

On Making Tax Digital he will say:

“One of our key roles is to try to ensure that tax policy and administration in the UK is as realistic and workable as possible. To that end, whilst as an Institute we are very supportive of the principle of digitalising the tax system, we continue to have some concerns about the way that the Making Tax Digital programme is being implemented. It was encouraging that the start date was delayed by 12 months for businesses below the VAT threshold but as everyone in this room knows well, there remain areas of concern especially in relation to its impact on small businesses. We are keen to continue to work with HMRC to see if those concerns can be addressed”.

On government help for taxpayers on low incomes, he will say:

“Something for which we may not get enough credit from the public is the fantastic work that our Low Incomes Tax Reform Group do. LITRG is a key part of the CIOT and it does truly excellent work in protecting the interests of those on low pay or who have retired. At the risk of being controversial, I am really concerned that shortage of funds means that HMRC and the Government are failing to provide the necessary levels of support to ensure the tax system deals with such people properly and I do feel that LITRG is sometimes doing things that unquestionably should be done by Government. After all, if Government continues to maintain a complicated tax system, surely they have an obligation to ensure that they explain it properly to those least able to deal with it. On that note I’d like to pay a public tribute to Anthony Thomas who steps down today as Chair of LITRG after five years of inspirational leadership. Anthony, thank you for everything you’ve done.”

Notes for editors

1.       CIOT Officers

New President – John Preston
John Preston BSc, CTA (Fellow) FCA is a consultant, trustee and non-executive director. He retired from PwC in June 2014 where he was a member of the Global Tax Leadership team responsible for External Relations, Regulation and Policy. He is a former Chairman of the Institute's Examination Committee and Education Committee. He is also a past chairman of the Membership and Branches Committee and Student Conference Working Party.

New Deputy President – Ray McCann
Ray McCann is a partner in the Joseph Hage Aaronson LLP, having formerly been a partner in London law firm New Quadrant partners and before that an HMRC Inspector. Ray is a member of the CIOT/ATT Joint Professional Standards Committee and was Chairman of the Committee between 2013 and 2015. Ray acts for both private wealth and corporate tax clients mainly in relation to disputes with HMRC. Ray also assists Tax Help and regularly speaks at conferences and other events. As well as CIOT Ray is a member of the Association of Taxation Technicians and the Chartered Management Institute.

New Vice President – Glyn Fullelove
Glyn Fullelove is the Group Corporate Services Director (incorporating Head of Tax Function) of Informa Plc. He is also Chairman of the Technical Committee of the Chartered Institute of Taxation, former Chairman of the International Taxes Sub-Committee and a member of the CIOT Council. He has worked in tax for over 25 years, and is a Chartered Accountant and Chartered Tax Adviser. He has previously held senior finance roles at a number of UK headquartered multi-national companies, including Williams plc, Invensys plc and Misys plc. He has spoken at a number of conferences and similar events on international tax and the OECD “Base Erosion and Profit Shifting” project in recent times.

2.       The Chartered Institute of Taxation (CIOT)

The CIOT is the leading professional body in the United Kingdom concerned solely with taxation. The CIOT is an educational charity, promoting education and study of the administration and practice of taxation. One of our key aims is to work for a better, more efficient, tax system for all affected by it – taxpayers, their advisers and the authorities. The CIOT’s work covers all aspects of taxation, including direct and indirect taxes and duties. Through our Low Incomes Tax Reform Group (LITRG), the CIOT has a particular focus on improving the tax system, including tax credits and benefits, for the unrepresented taxpayer.

The CIOT draws on our members’ experience in private practice, commerce and industry, government and academia to improve tax administration and propose and explain how tax policy objectives can most effectively be achieved. We also link to, and draw on, similar leading professional tax bodies in other countries. The CIOT’s comments and recommendations on tax issues are made in line with our charitable objectives: we are politically neutral in our work.

The CIOT’s 18,000 members have the practising title of ‘Chartered Tax Adviser’ and the designatory letters ‘CTA’, to represent the leading tax qualification.

Contact – George Crozier on 020 7340 0569 or 07740 477374 (email gcrozier@ciot.org.uk)

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