Today’s announcement by the Financial Secretary to the Treasury outlining a new timetable for Making Tax Digital marks a significant shift in Government policy. The new minister has listened to the voices of our profession as well as business in acknowledging that those small businesses who fall below the VAT threshold should move to a digital tax system at a pace that works for them.
This is a great outcome to an eighteen month campaign by ICAEW, our members in Parliament and beyond, other tax professional bodies and those representing small businesses. As a result of our combined efforts, the country’s smallest businesses will not be forced to struggle with the additional regulatory burden that Making Tax Digital would have effectively imposed. We all support HMRC in its efforts to take advantage of technology and digital to make it easier to comply with our complex tax code. But we believe that this needs to be done with systems that businesses and individuals will want to, rather than be forced, to use.
We now need to get on with the job of helping HMRC and HM Treasury do this, providing constructive feedback on their plans as they start to roll out Making Tax Digital over the coming months.