The uncertainty caused by the inconclusive general election result creates an opportunity for a rethink about the timetable for the roll out of Making Tax Digital – the government’s flagship programme for modernising the administration of the tax system.
Andrew Hubbard, tax consultant with RSM, said:
‘The timetable was already under considerable pressure before the election but now there are two additional factors to consider. First there is the possible agreement with the Democratic Unionist Party that is known to have considerable reservations about some aspect of Making Tax Digital; particularly the access problem that individuals in the rural parts of Northern Ireland have to high speed broadband.
‘Second is the fact that the minister with day-to-day responsibility for HMRC – Jane Ellison – lost her seat in the election. Her successor Mel Stride, who has only just been appointed, will presumably want to review the Making Tax Digital programme before making any final decisions about the timetable.
‘Ultimately, HMRC is right to pursue the Making Tax Digital agenda as modernising the way that the tax system operates is to everybody’s advantage. However, the proposed timetable is unrealistic and will not allow proper time for a new system to be properly developed before it comes into operation. The unexpected outcome of the general election is an ideal opportunity for a pause for thought, followed by a realistic reassessment of the timetable.’