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Reviews seem to popping up all over the place. No sooner had we digested the loan charge review – which was the second review of the charge – than we saw the off-payroll review, reported on page 4. What are we to make of these reviews?
Expectations must be properly managed. This is not just an issue for HMRC. For both reviews an over-optimistic expectation, such as postponement or complete scrapping, had been created by some commentators. So when the outcome is more modest it can be painted as a whitewash. That helps no one.
Where should reviews sit? Do they add something new or do they disguise previous shortcoming in the process? The review of the loan charge was necessary largely because of the failure of parliamentarians to understand what they were voting for. Similarly, one could argue that the points that have been clarified in the off-payroll rules should have been sorted out much earlier.
Reviews are essential, but there should be a two-stage process. Before legislation is enacted there needs to be time for a thorough review of the policy and how it will be implemented. Parliamentarians are not properly supported when looking at tax. Although the professional bodies do excellent work here, we need a fully staffed parliamentary tax office, independent of the Treasury, to give impartial advice. The second review should be after implementation. Some of this is done by the Office of Tax Simplification and the public accounts committee, but there is no consistent approach.
We need more rigour in the evaluation of major tax changes.
