tax system redesign

The Institute of Directors (IoD) has called on the Government to subject the UK tax system to a 'complete redesign', in a bid to tackle tax avoidance.

The business group says that introducing increasingly complex legislation in response to tax avoidance is leading to an ever more confusing tax system and is therefore proposing a radical overhaul of the tax system. While it acknowledges the arguments against avoidance, such as competition distortion - where those who engage in extensive tax avoidance pay less tax than those who do not, the IoD is asserting that the fault lies with the tax system itself, arguing that 'while tax avoidance cannot be celebrated, no-one has the moral standing to say that a business has acted wrongly if it acts within the law to reduce its tax burden'.

Richard Baron, Head of Taxation at the IoD, said, 'Reforming the tax system would obviously not be an easy task. It would mean some drastic changes. However, the task may still be worth undertaking as the current approach is leading to an impossibly complex and confusing tax system'