Digital tax plans will come under the microscope after the House of Lords set up a special sub-committee to investigate the impact of the proposed changes on landlords and small businesses.
The Government’s controversial Making Tax Digital plans include proposals requiring businesses and private landlords to submit information quarterly to HMRC and are set to be implemented by 2020.
However, concerns have been raised that the changes are being rushed through without proper consultation, with the Treasury Select Committee warning there are ‘serious shortcomings’ within the proposals as they stand – concerns shared by the RLA.
Landlords will now be asked to give evidence to the newly established Finance Bill Sub-Committee (FBSC), set up by the House of Lords Economic Affairs Committee to inquire into the draft Finance Bill 2017.
It will be focusing on issues of tax administration, clarification and simplification.
It is inviting evidence from landlords, businesses and other affected individuals on:
- the evidence underlying the case for the Making Tax Digital proposals and their suggested impact. The FBSC would be interested in statistical and other evidence, including that drawn from the experience of other tax jurisdictions, relevant to an assessment of the potential impacts of these proposals on businesses, landlords and other taxpayers;
- the evidence base for mandatory digital reporting. In particular the potential impact on the ‘tax gap’ and for HMRC resources;
- the scope of the exemptions and measures to help the digitally excluded;
- the robustness of the proposed timetable from the perspective of each of the groups affected, including the software industry, different taxpayer groups (such as small businesses and landlords), intermediaries and HMRC;
- the adequacy of the proposed measures to simplify the calculation of taxable profits and basis periods and the timing of their introduction; and
- the consequential revisions to the penalty regime.