New innovative approach for testing legislation proposed

HMRC is consulting on a new way to pilot and test legislative changes that recognises the value of taxpayer insight and the benefits of developing policy thoroughly and collaboratively. Currently testing of changes or collaboration with external stakeholders can be limited by legislative inflexibility.

The consultation defines the proposed approach as ‘a temporary environment where HMRC could conduct tests of new policy and processes which suspend implement ease and/or harmonise legal obligations. This could be for a distinct group of people or sector for a defined period of time and would be accompanied by appropriate safeguards and guidance’.

It would allow the creation of temporary legislation to suspend the usual tax administration rules for an identified section of the taxpayer population in time-limited pilot schemes. The aim is to allow for more transparent policy and process development. HMRC adds that it could explore ‘a showcase...