{"id":11781,"date":"2023-10-23T15:09:02","date_gmt":"2023-10-23T14:09:02","guid":{"rendered":"https:\/\/www.taxpolicy.org.uk\/?p=11781"},"modified":"2023-10-23T16:01:30","modified_gmt":"2023-10-23T15:01:30","slug":"complexity","status":"publish","type":"post","link":"https:\/\/heacham.neidles.com\/2023\/10\/23\/complexity\/","title":{"rendered":"The reality of tax complexity, and how to fix it"},"content":{"rendered":"\n

It\u2019s a common complaint that the UK tax system is much too complicated. That complaint is correct.<\/p>\n\n\n\n

Some of the complication is inevitable (modern life is complicated). Some is a response to avoidance. Some is driven by policy choices (e.g. VAT exemptions1<\/a><\/sup>Once you decide restaurants have to charge VAT at 20%, but ingredients should be 0%, you are on a one-way road paved with Jaffa Cakes<\/a> and giant marshmellows<\/a><\/span>). But some of the complication really is unnecessary. I’ll try to demonstrate the problem by taking one tax point that faces many companies investing in the UK, and working through each of the overlapping rules the company has to work through.<\/p>\n\n\n\n

Judge for yourself how sensible those rules are, and how many are really necessary.<\/p>\n\n\n

The scenario<\/h2>\n\n\n

Let’s pick a simple scenario that’s realistic – indeed very common:<\/p>\n\n\n\n