Five key issues which the tax working group should consider

Smith & Williamson welcomes the setting up of a new working group to look at the competitiveness of the UK tax system.

Richard Mannion, the firm's head of national tax, suggests five key issues which the tax working group should consider:

1. Introduce a permanent independent tax body: just looking at the tax system as it affects multi-nationals is not enough. We need a tax policy body that is independent of the Government of the day (as in Ireland) and which takes the long term view, ie longer than the term of any one Government. Hopefully this would avoid another Arctic type debacle on the tax position of owner-managed businesses which has spanned over 3 years.

2. Recognise that businesses increasingly operate at an international level: business is far more international than just 20 years ago (let alone 100 years ago when most of the rules were written), and so the UK/EC tax systems need to take account of the competing systems available to mega-corporations around the world.

3. Seek stability rather than change: constant change is not good and we need stability. So once we have decided what the long term model should look like there should be no knee jerk reactions and/or election wheezes (like nil rate bands that change behaviour and then get changed within two years).

4. Simplify the tax system: for example by cutting out the constant tinkering. This may mean an end to targeted reliefs (like R & D) that are trumpeted as taxpayer friendly ideas but which don't work as intended and merely serve to complicate the statute.

5. Improve services to taxpayers: whatever the system it needs to be operated fairly by a tax authority which is properly resourced with sufficient experienced staff to provide a proper "customer" service.

Note to editors

Smith & Williamson is an independent professional and financial services group employing over 1,400 people. The group is a leading provider of investment management, financial advisory and accountancy services to private clients, professional practices and mid-to-large corporates. The group operates from offices in London, Belfast, Bristol, Glasgow, Guildford, Maidstone, Salisbury, Southampton, and Worcester. 

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