The UK government has published a series of tax documents and consultations in a move to strengthen policymaking and help create a more trusted, simple, and modern tax system.

More than 30 policy updates, consultations and documents that would traditionally be published at Budget have been released as part of the ‘Tax policies and consultations update (Spring 2021)’.

The government has published:

  • A call for evidence on the tax administration framework, to create a trusted, modern tax administration system that is simpler, easier to navigate, and meets the needs of taxpayers.
  • A consultation on potential changes to Air Passenger Duty cutting the tax on domestic flights. The consultation also seeks views on supporting the UK’s commitment to net zero emissions by 2050 by increasing the number of international distance bands. This would reinforce the “polluter pays principle”, by ensuring that those who travel furthest internationally, and consequently have the greatest impact on the environment, incur the most duty.
  • An interim report on the government’s Fundamental Review of Business Rates, which sets out a summary of responses to last year’s call for evidence. The final report will be published in the Autumn.

Also, as part of the release, the government has announced it will legislate to tighten tax rules for second property owners meaning they can only register for business rates if their properties are genuine holiday lets.

In England, many holiday lets are liable to pay business rates, rather than council tax, when an owner declares that they intend to let their property in the next year. They may also be able to claim rates relief of up to 100%. The change announced will ensure that owners of properties that are not genuine businesses are not able to reduce their tax liability by declaring that a property is available for let but make little or no realistic effort to let it out.

The update will also cut inheritance tax red tape for more than 200,000 estates every year, dramatically reducing the amount of paperwork many families fill out. Over 90% of non-taxpaying estates each year will no longer have to complete inheritance tax forms when probate or confirmation is required from 1 January 2022. None of today’s announcements will have any impact on the government’s finances or require legislation in the current Finance Bill.

Financial Secretary to the Treasury, Jesse Norman, said: “We are making these announcements to increase the transparency, discipline and accessibility of tax policymaking.

“These measures will help us to upgrade and digitise the UK tax system, tackle tax avoidance and fraud, among other things.

“By grouping them together, we want to give Members of Parliament, tax professionals and other stakeholders a better opportunity to scrutinise them.”

ICB's Director of Technical Policy, Jacquie Mount C.FICB, said: ''ICB have already submitted responses to the initial consultation documents covering the areas of tax administration, and raising standards in the tax market, and will be making further responses to all new consultations relevant to its members.''

Consultations and calls for evidence will also:

  • Clamp down on promoters of tax avoidance schemes.
  • Consider whether tax advisers should be required to hold professional indemnity insurance to help raise standards. They are also looking for a definition of tax advice.
  • Begin to explore whether the current timing and frequency of tax payments are appropriate. Self-employed workers could be forced to pay taxes in the same way as those on PAYE.

The government is also seeking views through a call for evidence on how the legislation underpinning HMRC’s administration of the tax system could be updated to make the tax system easier to deal with and help make tax more straightforward for taxpayers and help build greater resilience and capacity to respond to future crises.