House of Lords report on tax policy

Government tax policy is inconsistent and confusing new laws are being introduced without sufficient consultation – potentially undermining the crackdown on tax avoidance, a House of Lords committee has warned.

In a report on the government’s Finance Bill 2011, the House of Lords Economic Affairs committee welcomed efforts to make the tax system simpler and more stable, but said that the government had sometime ignored these principles when drafting new tax laws.

Disguised remuneration rules attacked

Peers singled out the government’s draft legislation on “

disguised remuneration

" for particular criticism. One witness said that the draft rules, which target tax avoidance by employers, often through loans and trusts, were “incomprehensible”, even for tax experts.

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