The UK tax system is often frustrating and too complex but it is “not broken”, according to the new president of the Chartered Institute of Taxation (CIOT).
In his inaugural speech, incoming president Patrick Stevens said that although the UK tax system is “far from perfect” a stream of negative and at times misleading headlines about HMRC and the tax system risk giving taxpayers the impression that the system is broken. This could undermine confidence in the system and reduce compliance by taxpayers, he said.
The CIOT should combine robust representations to the tax authorities on behalf of taxpayers and their advisers, with robust challenges to exaggerations about the tax system’s failings, said Stevens, who succeeds Anthony Thomas.
The tone of Stevens’speech and his measured support for HMRC contrasted with his predecessor Anthony Thomas who began his year in 2011 by warning HMRC that it risked losing taxpayers’ and advisers’ trust.
Coverage of HMRC mistakes in the past couple of years and deals it has done with some large companies may give people the impression that the UK tax system is similar to Greece’s, Stevens said.
“Everyone in this room knows that we are so far away from the position in Greece that you cannot compare it,” Stevens told CIOT’s annual meeting in London. “But every time those headlines appear, one or more of the passengers on the Clapham omnibus thinks our system must be broken and there is no need for them to join. That affects our members. It is often the perception rather than the reality that is important.”
Tax advisers should support the taxman when journalists, campaign groups and politicians exaggerate its failings, and present the system as broken when it is not, Stevens said. “[Is the UK tax system] imperfect? Yes. Frustrating? Frequently. Over-complex? Undoubtedly. But not broken.”
Stephen Coleclough has been made the CIOT’s new deputy president. AccountingWEB contributor Anne Fairpo was appointed vice president and should rise to the top spot in 2014.