AAT public affairs and public policy activities: February 2021
10 March 2021
Every month AAT summarises some of the key Public Affairs & Public Policy activities undertaken on behalf of our members.
Below you will find some key highlights for February 2021.
If you would like any further information about any of these issues, please contact Phil Hall, AAT Head of Public Affairs & Public Policy via Twitter or via email.
No income tax, no VAT, no money back, no guarantee
With the Government again ruling out increases in income tax, NICs or VAT as per their December 2019 election manifesto commitment, raising money to pay back the ever-increasing Coronavirus debt pile is looking increasingly challenging.
AAT has made a number of recommendations for change in this area primarily around thresholds and eligibility and whilst there is no guarantee that these will be implemented, one such suggestion has gained considerable attention - to effectively abolish the VAT threshold by requiring all businesses, irrespective of turnover, to register for VAT as already happens in Italy, Sweden and Spain. This is explained in more detail over on AAT Comment.
Having surveyed members on the subject, receiving over 800 responses, we discovered that 37.5% back a reduction, 33% favour leaving the VAT threshold at £85,000 and 24% want a big increase to £500,000.
These results have subsequently been brought to the attention of policymakers and a diverse range of stakeholders, with more to follow on the issue in the weeks and months ahead.
Bounce Back BBC
I again appeared on BBC Radio Humberside, this time to discuss AAT recommendations to write-off Bounce Back Loans to over 1 million small businesses.
This recommendation, first made by AAT in September 2020, is gaining increasing attention and has moved to the mainstream as a result of almost 400 small business leaders recently writing to the Chancellor to request the same.
Budget bonanza
An hour was spent discussing AAT views on issues ranging from IR35 and Making Tax Digital to Bounce Back Loans, Corporation Tax and Capital Gains with IPSE Director of Policy Andrew Chamberlain and several hundred IPSE members in a Budget webinar last month.
Open approach to open data
The Office of Tax Simplification (OTS) is currently undertaking a call for evidence on Open Data
AAT licensed accountants were asked for their views on the issue and the survey results were subsequently shared with the OTS in an online meeting with the OTS team.
View the full response on our Public Policy work page.
Further mileage from AAT road pricing recommendations
I was invited to discuss AAT’s recommendation to scrap fuel duty, VAT on fuel and Vehicle Excise Duty and to replace these with Pay As You Drive (PAYD) technology with several members of the Liberal Democrat Treasury and Transport front bench teams in the House of Lords.
In the House of Commons, Liberal Democrat Business Spokesperson, Sarah Olney MP, asked the Chancellor about his plans in this area.
The issue was also discussed with Members of the Scottish Parliament and Plaid Cymru in Wales.
A new Tax Environment?
We responded to the Environmental Audit Committee inquiry into the Deposit Return Scheme (DRS) whereby you can return your cans and bottles to the seller for a small payment - due to come into force across England, Wales and Northern Ireland in 2024.
A wider response, making reference to the DRS but also to the Plastic Packaging Tax, Road Pricing and a range of other environmental issues was also submitted to the Public Accounts Committee inquiry into environmental taxes.
Both responses highlighted 2019 survey results that found 100% of AAT Council and Assembly members think reaching net zero by 2050 is important as do 88% of AAT licensed accountants.
Parliamentary engagement
Engagement with a dozen Parliamentarians in February centred on subjects including the Budget, Road Pricing, contactless card payments and Making Tax Digital.
Non-Parliamentary engagement
Engagement with over 40 external stakeholders took place in February. These included the likes of Airbnb, the OTS, Home Office, BEIS and Vodafone on issues ranging from VAT, IHT, contactless card payments, third party data and statutory reviews.
AAT consultations, calls for evidence & inquiry responses
AAT responses to inquiries, calls for evidence and consultations on environmental taxes, the Deposit Return Scheme, changes to HMRC statistics and third party data usage for tax purposes were all made in February and several others have been started and are due for completion this month.
These and other responses can be viewed on the AAT Policy page.
Other meetings, events and engagements
- Adam Harper represented AAT at the Representative Body Steering Group (RBSG), an important forum that engages with professional bodies, intermediaries, software developers and senior HMRC managers.
- I participated in the regular HMRC Virtual Communications Group (VCG).
- Represented AAT at the regular trade bodies roundtable hosted by the Federation of Small Business (FSB).
- Met with CIPP to discuss joint events and Budget 2021.
- Together with Adam Williamson, attended APPG meeting on Responsible Business and the business response to Covid-19.
- Represented AAT at an HMRC led roundtable in relation to tax avoidance.
