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ACCA welcomes MP's analysis of Budget 2012
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The Association of Chartered Certified Accountants (ACCA) has welcomed the Treasury Select Committee's analysis of the 2012 Budget.
According to the accountancy body, the report's findings bring a much needed critical oversight of the policies announced in March.
It raises a number of concerns about the policies announced by chancellor George Osborne last month, urging the government to limit its use of retrospective taxation and explain the likely impacts of the 5p tax cut.
Andrew Tyrie MP, chairman of the Treasury select committee, said: "Retrospective tax legislation conflicts with the principles of tax policy recommended by this committee and with those laid down by the chancellor.
"We therefore have serious reservations about retrospection in the tax system."
Chas Roy-Chowdhury, ACCA's head of taxation, said that over the last month, the body has been concerned about the unintended consequences that have arisen as a result of the Budget.
"We would welcome a consultation on retrospective tax policy changes, and also hope that the government will publish the impact of the 5p cut in the top rate of tax," he stated.
However, ACCA has welcomed the introduction of personal tax statements as a means of offering personal taxpayers clarity about their tax payments and arrangements.
Mr Roy-Chowdhury said a good tax system should be transparent and understandable and tax statements tick both boxes in this respect.
"But as the Treasury Select Committee says, these need to be well designed with the taxpayer in mind," he added.
"We have seen in this Budget more complexity engineered into the tax system, from the taxation of child benefit, to age allowance curtailment, to the stamp duty anti-avoidance measures."
Mr Roy-Chowdhury warned that these complexities have brought about confusion and misunderstandings.
"The UK's tax system is complicated, and we know that the Treasury Select Committee is working to shine a much needed spotlight onto issues that are confusing," he stated.
The ACCA tax chief said the system needs to be fair, transparent, and accountable.
"We consider this Budget as scoring low in terms of taking forward the simplification agenda," Mr Roy-Chowdhury stated.
Posted by Jon Aspinell
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