This week's opinion

The chancellor did not waste much time in rejecting the Office of Tax Simplification’s work on reducing the VAT threshold. I can’t say I was surprised. There was a good deal of logic in what was suggested but as the OTS itself recognised any move to bring more small businesses into the VAT net would result in significant political opposition and given its precarious position the government was never going to risk alienating the small business community. I suspect the VAT threshold falls into the category marked‘I wouldn’t start from here if I were you’. Had the threshold been much lower from the beginning nobody would I suggest have been now been recommending increasing it to £85 000. This episode is a good example of how simplification comes with a cost: any sensible simplification proposal is bound to have winners and losers.

Thoughts of...