Future Retirement Success
  • Politics
  • Business
  • Investing
  • Stocks
  • Politics
  • Business
  • Investing
  • Stocks

Future Retirement Success

Business

VAT expert calls for reform of “Britain’s most contentious tax” on 50th anniversary

by March 30, 2023
March 30, 2023
VAT expert calls for reform of “Britain’s most contentious tax” on 50th anniversary

As VAT reaches a historic milestone of 50 years in UK law, the head of VAT at an organisation supporting more than 4,500 businesses in the East Midlands is calling for drastic reform of Britain’s most contentious tax.

From April 2022 to February 2023, HMRC reports that it collected a staggering £150.5 billion from VAT alone – but with 428,615 UK businesses closing in 2022 amid unprecedented operating costs and energy prices, there are calls for clearer regulation to avoid unexpected charges.

Head of VAT at Duncan & Toplis, Christine Newitt, says: “Valued Added Tax is a prolific source of revenue for the government, behind only National Insurance and Income Tax – but it’s easily the most contested and contentious tax for UK business owners.

“In the five decades since VAT came into force on April 1, 1973, it has been a constant minefield for businesses struggling to navigate a system with more exceptions than it has rules – often resulting in unexpected interpretations by HMRC even for those of us in the profession who understand the tax.”

Christine represents businesses on the VAT and duties group of the Institute of Chartered Accountants in England and Wales (ICAEW) and speaks to local business owners across the East Midlands every day, many of which are seeking urgent advice on avoidable VAT pitfalls.

“I can confidently say that businesses need fewer intentionally prohibitive rules and exclusions and clearer guidance,” adds Christine.

“VAT was introduced as a directive from the European Union, but after Brexit, we’re no longer bound to follow these rules. We have a chance to reimagine VAT in a way that could benefit business owners across the country – VAT’s golden anniversary is a golden opportunity for it to be reformed.”

Despite being in place for half a century, the administration of the VAT system has never kept pace with advances in technology and the global market place. Christine thinks that businesses could benefit from VAT being reformed to make it more transparent for business owners, with a much reduced burden of administration.

“Some countries like Brazil, for example, have adopted a split payment system, where VAT is split out at the point of sale and paid electronically directly to the tax authorities.”

“This would be a bold move but would certainly shift the onus from over-burdened business owners, making sure that HMRC always receives the tax it is owed and giving businesses the certainty of knowing that, from a VAT perspective at least, they won’t face any sudden surprises.” adds Christine

The comments come just days after businesses reacted to an underwhelming Spring Budget, which Head of tax at Duncan & Toplis Nicholas Smith branded “a resounding disappointment for SMEs across the East Midlands and the UK.”

Nicholas Smith said: “SMEs make up 99.9% of the UK economy, according to the government’s own figures. So where is the support for them as the cost of living crisis closes doors across the nation?”

HMRC is currently focusing on broadening its Making Tax Digital initiative across all taxes, which aims to replace the outdated paper systems with a fully digitised offering. Advancement in technology and systems to handle tax collection is long overdue.  It is hoped that this will enable businesses to submit updates for all taxes every quarter, rather than annually, and make records more up to date – but Christine maintains that, for some businesses, it “doesn’t go far enough in giving businesses clarity and certainty in their tax affairs”.

Read more:
VAT expert calls for reform of “Britain’s most contentious tax” on 50th anniversary

0
FacebookTwitterGoogle +Pinterest
previous post
VanceAI Review: Productivity Series Offers Accessibility and Results
next post
Business Champion Awards triumph for coach Polston

You may also like

Inheritance Tax Conflicts with Conservative Values, Says Hunt

May 25, 2024

Wetherspoons announces another 11 pubs to close with...

January 27, 2023

Childcare costing parents up to 70 per cent...

September 6, 2022

Four in ten UK SMEs take over 90...

August 29, 2023

Over £2m invested in UK niche vehicle projects...

September 17, 2024

An In-Depth Interview with Dr. Sergey Macheret: Exploring...

January 23, 2025

3 Benefits of Using an Akko Mechanical Keyboard

March 17, 2023

Surrey runs out of state school places for...

December 13, 2024

Revolutionizing E-commerce: The Crucial Role of Order Management...

December 13, 2023

Black Friday causes heightened anxiety for almost 70%...

November 23, 2023

    Get free access to all of the retirement secrets and income strategies from our experts! or Join The Exclusive Subscription Today And Get the Premium Articles Acess for Free

    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Recent Posts

    • Horizon victim Lee Castleton sues Post Office and Fujitsu for £4.5m in landmark legal claim

      August 7, 2025
    • Bank of England expected to cut interest rates to 4% amid weakening UK economy

      August 7, 2025
    • OpenAI in talks over $500bn share sale, potentially surpassing SpaceX in value

      August 7, 2025
    • UK construction activity slumps to lowest level since Covid amid housing slowdown

      August 7, 2025
    • Getting to Know You: Stuart Davis, CEO & co-founder, Dubs Universe

      August 7, 2025
    • TSB brand under threat as £2.65bn sale to Santander approved by Sabadell shareholders

      August 7, 2025

    Categories

    • Business (8,697)
    • Investing (2,179)
    • Politics (16,329)
    • Stocks (3,228)
    • About us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: futureretirementsuccess.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2025 futureretirementsuccess.com | All Rights Reserved