Tories pledge to make tax simpler

The Conservative Party have given the first indication of their budget policies should they form a government at the next election.

George Osborne, shadow chancellor, launched a report on Thursday that highlighted plans to simplify the current UK tax system.

The report, written by former Conservative chancellor Lord Howe, outlined plans to create an Office of Tax Simplification.

Other proposals suggested strengthening parliamentary oversight of tax legislation through a joint parliamentary select committee and the creation of a convention that all changes to tax law should be proposed before the pre-Budget Report.

The report claimed that these proposals will create a "simpler and more transparent tax system".

In the last year, Britain has overtaken India as the country with the longest tax code in the world, claimed the report.

Howe also proposed to stop stealth taxes and introduce more parliamentary scrutiny of tax law.

Commenting on the report, Howe said: "This is not a prescription for instant solution.

"I long ago reached the conclusion that political will alone is not sufficient for achieving a genuine and lasting simplification of the tax system. What is required is fundamental reform of the way in which tax law is made.

"The problem is too many rules, [that are] too long and too complicated."

Howe described the process of creating the report as "a formidable exercise" and stated that there would be "a very long haul" before changes could be seen.

Howe stated that when he was chancellor, the "little red book" used to be around 32 pages long. He joked that it now seems to weigh about four kilograms. He said that this growth in the Budget was "grotesque".

Also speaking at the launch of the report, George Osborne said that the result of these plans would be a simplification of tax policy.
 
"It will mean no more stealth taxes," he said.

"The government will no longer be able to bury the bad news in the small print."

Complex

Osborne referred to Labour’s budget proposals as "badly thought through" with "complex initiatives" and "humiliating U-turns".

 "So many of the problems we have seen over the last 11 years could have been avoided if such a simple convention had been in place," he said.
 
"Anyone who has been involved in the process of making tax law will see that they constitute nothing short of a revolution in our framework for making and scrutinising tax policy."
 
Osborne also blasted Labour's criticism of the report.

"Today, Labour treasury ministers have dismissed Lord Howe's proposals without even reading his report," he said.

"It shows how short-term and partisan their focus has become."
 
He added that the creation of financial stability must come before he would consider introducing tax cuts.

Osborne said: "Our ambition is to reduce taxes but I won’t do so if public finances can’t sustain that."

But the proposals launched today do not apply to recent controversial tax issues such as the scrapping of the 10p income tax rate or plans to raise car tax on gas-guzzlers.

The report comes a day after Alistair Darling's first Budget became law in the Commons last night.

Only six Labour MPs rebelled over Darling's controversial plans to increase vehicle excise duty on the most polluting vehicles, despite expectations of a larger Labour rebellion.