Tax Administration and Maintenance: Spring 2024

Thursday 18th April 2024 Written Statements

[The Financial Secretary to the Treasury (Nigel Huddleston)]

At spring Budget, the Government cut taxes for working people and announced a range of reforms to support the ambition for a tax system that is simple, fair, and supports growth.

The Government also committed at spring Budget to launch a consultation on the impacts of recent High Court rulings on the private-hire vehicle sector and provide an update on the recent consultation on tackling non-compliance in the umbrella company market.

Today, the Government deliver on these commitments, supporting businesses and consumers, protecting workers and ensuring fair competition.

The Government are also announcing two further technical tax policy proposals that make the tax system fairer and tackle non-compliance.

The announcements today are:

Consultation on the VAT treatment of private-hire vehicles: The Government are publishing a consultation on the potential tax impacts of the recent High Court rulings on the private-hire vehicle sector. This consultation also invites views on potential Government interventions that could help to mitigate any undue adverse effects on the PHV sector and its passengers.

Tackling non-compliance in the umbrella companies market: The Government will publish a response to their consultation on reducing tax non-compliance in the umbrella company market in due course. To support workers and businesses that use umbrella companies, His Majesty’s Revenue and Customs will publish new guidance later this year which includes an online pay-checking tool. The Government are minded to introduce a statutory due diligence regime for businesses that use umbrella companies and will continue to engage with the recruitment industry and other key stakeholders on the detail of this.

VAT treatment of charitable donations: In order to encourage charitable giving, the Government will consult on introducing a targeted VAT relief for low-value goods that businesses donate to charities for them to give away free of charge to people in need. The consultation will be launched later this year.

Mandating postcode provision for freeports and investment zones NICs reliefs: The Government are announcing their intention to bring forward a legislative change to mandate employers operating in a freeport or investment zone special tax site to provide their employee’s workplace postcode to HMRC if they are claiming the relevant secondary class 1 NICs relief through their payroll, in due course. To support this, it will also publish a four-week technical consultation on draft regulations.

The publications and announcements can be found at https://www.gov.uk/government/publications/summary-of-tax-administration-and-maintenance-spring-2024.

[HCWS414]