AIA E-NEWS: GOVERNMENT PUBLISHES DRAFT TAX LEGISLATION

 

This article first appeared in the AIA Accountancy e-News, for more information click here.

On 11 December the Government published draft tax legislation, as well as responses to consultations that have taken place over the summer. The legislation will be included in Finance Bill 2013 and implements a number of tax policies announced at Budget 2012 and Autumn Statement 2012. The draft legislation is open to technical consultation until 6 February 2013.

Finance Bill 2013 will include key government measures to support growth, including:

  • reducing the main rate of corporation tax to 21% in 2014;
  • increasing the annual investment allowance for plant and machinery to £250,000 for two years from 1 January 2013;
  • introducing tax reliefs that are among the most generous in the world for the video games, high-end TV and animation industries; and
  • introducing an 'above the line' tax credit for R&D.

The draft legislation also includes action to support households and reward work, including increasing the tax free Personal Allowance to £9,440 from April 2013. It implements several important government actions against tax avoidance, including the General Anti-Abuse Rule (GAAR) and the Budget 2012 action to counter avoidance of Stamp Duty Land Tax (SDLT).

This is the third year that draft legislation has been published as part of the Government's commitment to a more transparent, efficient and simpler tax system. It also meets the Government's objective to confirm the majority of tax changes at least three months ahead of publication.

David Gauke, Exchequer Secretary to the Treasury said:

"The measures for which we are publishing draft legislation today are part of the Government's wide reaching reforms to deliver a progressive tax system that is simpler, affordable, fair and encourages growth. They demonstrate our commitment to listening to the views of those affected by changes to the tax system and this simple and transparent approach provides greater stability and certainty to taxpayers and businesses. "

On 11 December Government responses to consultations on a range of tax policies were published by HM Treasury and HM Revenue & Customs (HMRC). These include responses on:

  • The Statutory Residence Test and reforms to Ordinary Residence;
  • The fair taxation of residential property transactions;
  • Lifting the Lid on Tax avoidance Schemes; and
  • The Office of Tax Simplification's report on tax-advantaged employee share schemes.

This article first appeared in the AIA Accountancy e-News, for more information click here.