I’m really late on this but matter not and I’ll keep it short. It’s good to see the small business person win in the battle for common sense in the Arctic Systems case. It is interesting to note Richard Murphy’s response to the government’s announcement of amending legislation to plug what it sees as a loophole. Despite the fact the consequences as described in the case were anticipated by Norman Lamont back in 1988.
What is of far greater interest are the very large number of reads (13543) on the AWeb article covering the story. That’s one heck of a lot of tax practitioners out of the total offering advice. If HMRC is taking any notice at all, it would do well to note the deep concern those readers and commenters feel about HMRCs pronouncement on the matter.
Now is the time for the Tax Faculty, ICAEW to be making a stand on behalf of its members and their clients. The question is – will it and even if it does, will it have the desired effect? So far, ICAEW has only asked for ‘clarity and certainty.’ In this context, Nichola Ross Martin’s comments are apropos:
Given the contribution of small business to the economy and the chaos of a small business tax policy in the last ten years (which appears to be totally driven by knee-jerk reaction such as the above statement), I had honestly hoped for something a bit more mature under the new Chancellor. Unmarried couples share things, business partners share things and of course married couples do the same. Change the rules and you simply end up discriminating against one group.
In the ensuing debates, it will be interesting to see how this works its way out. I expect a battle royal between professionals and HMRC before any further legislation is enacted. It will be interesting to see how tax justice proponents like Richard position themselves on this issue. If Nichola is right, then it is difficult to see how the government’s current position is tenable without offending against the very issues of social justice that Richard holds dear.
It will require some genuine innovation on the part of the tax legislators to come up with a policy that is fair to all forms of civil partnership because having raised the issue as one for amendment, it can hardly duck out without raising fresh questions.
Technorati Tags: ICAEW



