The Chancellor presented the Spring Statement to the House of Commons today. A Written Ministerial Statement provides more detail on some of the announcements in the Spring Statement, and sets out details of other forthcoming government policies.
In the Statement, the Chancellor confirmed that the Government intends to launch a full three-year Spending Review before the summer recess (as long as there is not a no-deal Brexit), to be concluded alongside an Autumn Budget.
There was little of direct relevance to charities and taxation announced but some of the reports, publications and re-announcements may be of general interest.
- The Government has published a discussion paper launching a review of the Aggregates Levy, including the Terms of Reference, information on timing and scope of the review as well as membership of an expert
- As previously announced, from April 2019 the co-investment rate for the Apprenticeship Levy will be halved from 10% to 5%, and the amount employers can transfer to their supply chains would increase to 25%.
- As previously announced Making Tax Digital comes into force from 1 April. The Government has confirmed a light touch approach to penalties in the first year of implementation. Where businesses are doing their best to comply, no filing or record keeping penalties will be issued. The focus will be on supporting businesses to transition and the government will therefore not be mandating MTD for any new taxes or businesses in 2020.
- An independent report on the state of competition in digital markets has been published. CTG has previously confirmed that it does not expect the Digital Services Tax to impact charities, but it is important that we continue to monitor any potential unintended consequences of future taxation of the digital economy.
- The Government has published research evaluating corporate behaviour change in response to the corporate criminal offences. HMRC has also published No Safe Havens 2019, its strategy for countering offshore evasion.
- The Government has published a call for evidence on various proposals for a new Business Energy Efficiency Scheme focused on SMEs. Unlike previous consultations on this issue there is no focus on tax reliefs of incentives.
- The Government has published draft legislation detailing a new capital allowance for new non-residential structures and buildings.
- This Government has published a policy paper setting out its approach and achievements in tackling tax avoidance, evasion and other forms of non-compliance.
In the coming months the Government will publish:
- Preventing abuse of the R&D tax relief for small- or medium-sized enterprises (SMEs) – A consultation on the measure announced at Budget 2018, as part of the package on tax avoidance. This consultation will focus on how the measure will be applied, to minimise any impact on genuine businesses.
- Insurance Premium Tax operational review – A call for evidence on where improvements can be made to ensure that Insurance Premium Tax operates fairly and efficiently.
- General Anti-Abuse Rule (GAAR) Amendments – A technical note alongside draft legislation on minor procedural and technical changes to the GAAR legislation to ensure that it works as intended.
- National Insurance Contributions (NICs) Employment Allowance draft regulations – A document inviting technical comments on the draft regulations implementing the reform, as announced at Budget 2018, of the NICs Employment Allowance to restrict it to businesses with an employer NICs bill below £100,000.
- VAT Simplification and the Public Sector – A policy paper exploring a potential reform to VAT refund rules for central government, with the aim of reducing administrative burdens and improving public sector productivity.
- VAT Partial Exemption and Capital Goods Scheme: Simplification – A call for evidence on potential simplification and improvement of the VAT Partial Exemption regime and the Capital Goods Scheme – ensuring they are as simple and efficient for taxpayers as possible. This follows on from the recommendations of the Office of Tax Simplification, who have looked in detail at the VAT system and identified possible areas for improvement.
- Social Investment Tax Relief (SITR) – A call for evidence on the use of the SITR scheme to date, including why it has been used less than anticipated and what impact it has had on access to finance for social enterprises.
- Corporate Capital Loss Restriction – A summary of responses to the consultation on a change announced at Autumn Budget 2018 to restrict, from 1 April 2020, the amount of carried-forward capital losses a company can offset to no more than 50% of the chargeable gains arising in a later accounting period.