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More scrutiny
Following a Law Commission consultation on the potential for developing a more formal system for reviewing laws after they have been brought into force and encouraging better regulation, the commission presented its final report on the subject to Parliament at the end of October. Sir Terence Etherton, chairman of the commission, says that there was 'overwhelming support for the principle that there should be a more systematic approach to post-legislative scrutiny and that the process for such scrutiny should be controlled by Parliament'. The commission has suggested that Parliament consider setting up a new joint Parliamentary committee on post-legislative scrutiny.
Welcoming the Law Commission's suggestions for the development of a formal system of reviewing laws after they have been brought into force, John Cullinane, president of the Chartered Institute of Taxation, says that 'it is abundantly clear that there is a need for a Tax Law Commission. If tax law were assessed on a regular basis, this would undoubtedly improve the way in which tax is administered'. He says that 'the rule of law must be returned to the tax system', and adds that the CIOT 'believes that the rights and responsibilities of the citizen and tax administrator should be clearly set down in order to achieve an appropriate balance between the parties, in a system that has become rich in complexity and poor in explanation'.
www.lawcom.gov.uk/post_leg_scrutiny.htm
www.tax.org.uk
ISA reforms
A number of reforms to the ISA regime were announced by the Economic Secretary to the Treasury, Ed Balls MP at a recent PEP and ISA Managers' Association annual conference. The reform package includes:
- a commitment to a permanent future for ISAs beyond 2010;
- the removal of the mini/maxi distinction;
- the rolling of PEPs into the ISA wrapper;
- the rollover of some existing savings vehicles into ISAs, such as child trust fund on maturity.
Tony Vine-Lott of PIMA says that the association has lobbied for a commitment to ISAs beyond 2010 and the removal of the mini/maxi distinction, so he is 'absolutely delighted that the Treasury has taken on board these recommendations'. He anticipates more announcements on the ISA in the pre-Budget report.
Had the annual £7,000 maximum limit risen with inflation, say BDO Stoy Hayward, it would now stand at £9,380. However, the limit has remained unchanged since ISAs started in 1999, as has the £3,000 annual limit on cash ISAs, which would be £1,020 a year higher if it had increased with the cost of living. Stephen Herring of BDO Stoy Hayward says that the news that ISAs will continue indefinitely is a 'great boost in encouraging savings, as are proposed simplifying rules allowing investors to converts PEPs into ISAs'. However, he adds that BDO's calculations show that 'the limit on contributions needs to be raised, to ensure that savers continue to use ISAs', and he hopes that the limit will be increased in the pre-Budget report, perhaps to £10,000.
