PRESS
IFS
RELEASE
The Institute for Fiscal Studies
THE INSTITUTE FOR FISCAL STUDIES
7 RIDGMOUNT STREET, LONDON, WC1E 7AE
www.ifs.org.uk
TEL 020 7291 4800
How can the Government improve the Institutional Processes of
Tax Proposals and Tax Legislation?
A new report by a working party of the IFS's Tax Law Review Committee sets out
recommendations to improve the ways in which Parliament deals with tax proposals and
Embargoed until 10.30am ,
20th March 2003
legislation.
The working party, chaired by Sir Alan Budd, builds on the recommendations of the Commons' Modernisation
Select Committee. It concludes that Parliament must involve itself, at an earlier stage than is presently the case, in
the process of examining the government's tax proposals and legislation.
Recommendations to increase accountability, transparency and simplicity include the following:
•
Parliament should be actively involved in pre-legislative scrutiny of tax proposals once they have moved
beyond the drawing board and government has decided to implement them.
•
Parliament should always be given the time and the means to consider the tax proposals that the government
intends in due course to ask Parliament to endorse through enactment in the annual Finance Act. Neither the
timing of events nor the existence of a consultative process outside Parliament should enable governments to
present their tax proposals to Parliament as fait accompli.
•
Government should engage the process of Parliamentary scrutiny in every case by formulating its proposals
either as draft legislation or as a detailed statement of the proposal.
•
The mechanism for Parliamentary scrutiny should be a Select Committee on Taxation. Its terms of reference
should specifically recognise the need to enquire into the relative complexity of tax proposals.
•
There should be greater time allowed to debate the pre-Budget Report.
•
There should be established a Tax Structure Review Project as a parallel project complementing the Tax Law
Rewrite Project. The TSRP would have a remit to review current tax legislation free of the policy constraints
imposed on the TLRP and in particular from the perspective of seeing what can be done to simplify the tax
system. As such, it should act as a constant reminder within government of the need for tax simplification.
*** ENDS ***
Notes to editors
1.
The Tax Law Review Committee (TLRC) was launched by the Institute for Fiscal Studies in October 1994. Committee
members come from a wide variety of backgrounds and are drawn from the judiciary, the professions, commerce and
industry, former members of the Revenue departments and academia. The members include political supporters of the three
main UK parties. The Committee is sponsored by a number of private sector companies and individuals. Its President is
The Rt. Hon. The Lord Howe of Aberavon CH QC. The Committee is chaired by John Avery Jones CBE, and its Research
Director is Malcolm Gammie QC.
2.
The working party, which produced the paper, was chaired by Sir Alan Budd, the Provost of The Queen's College, Oxford,
former Chief Economic Adviser to the Treasury and Head of the Government Economic Service. He has also been a
member of the interest-rate setting Bank of England Monetary Policy Committee.
3.
The discussion paper, Making Tax Law: Report of a Working Party on The Institutional Processes for Tax Proposals and
Tax Legislation is available from IFS for £40 (£10 to IFS members) and will be available on the IFS website. For press
copies, contact Emma Hyman (020 7291 4850 or emma_h@ifs.org.uk).
4.
A briefing about the report will be held at 10.30 on Thursday 20th March at the Palace of Westminster. Please
contact Emma Hyman (020 7291 4850 or emma_h@ifs.org.uk) if you would like to attend.