Tax perceptions

EVER WONDERED WHAT HMRC spends our hard-earned tax on? Well apart from index-linked pensions for civil servants HMRC like to conduct research into tax-related subjects. They recently produced reports on capital gains tax and another on trusts. It would be interesting to know the real motivation behind this research particularly the one on trusts given the Treasury's Finance Act 2006 changes to their tax treatment. Is it really to confirm HMRC's apparent belief that every taxpayer's move is governed by the desire to pay less tax? If so they are likely to be disappointed because the research shows that people's actions tend to be governed by need first tax later.

The capital gains survey

HMRC commissioned Ipsos MORI to carry out research into the impact of the changes to capital gains tax in 1998. These changes were:

• freezing of indexation allowance and replacing it with taper...