Tax changes not very simple or fair

RECENTLY the Herald gave Mr Lloyd MP the opportunity to express his views on the Budget.

His comments on the so-called ‘granny tax’ were that the Budget simplified the matter of age-related allowances which apply to pensioners.

Some people might say that his explanation was likely to baffle brains. There were readers’ views which highlighted errors in Mr Lloyd’s figures. So far he has not corrected any of them.

But then the reason given for the need for simplification could be examined by referring to the report, page 62 of the Office for Tax Simplicity. (Yes there is one, it was set up by the Chancellor).

4.8 We would stress again that the OTS has not reached any conclusions as to the best way forward with age-related allowances, nor have we formulated detailed recommendations.

However, we know that there is little support for leaving both the structure of the allowances and the way they are administered as they are.

4.10 As well as fundamental simplification of the rules, there are strong views that the administration of age allowances could be simplified. Whilst we note that HMRC already has some plans to change the claims process, we have concluded that the second stage of our review should give high priority to exploring how further simplification could be achieved.

So the Chancellor ignored this report and Mr Lloyd seems to have followed his leader.

Perhaps it is more important to reduce the tax for wealthier people. It doesn’t seem very simple does it – or perhaps not very fair either.


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