- The UK VAT system may need significant reform due to rising public spending and tax revenue pressures.
- Reforming VAT is challenging, as seen with the backlash against VAT on private school fees.
- Experts suggest considering larger tax system reforms rather than minor adjustments.
- Political acceptance is a major hurdle, especially with sensitive VAT zero rates.
- A two-pronged approach is recommended, separating strategic policy from piecemeal policy.
- Social policies should not be integrated into the VAT system but introduced separately.
- Regular reviews are necessary to keep the VAT system updated with technological and sociological changes.
- Businesses and consumers prioritize better guidance and greater certainty in the tax system.
- Tax policy secrecy hinders public acceptance and trust, making it difficult to implement major reforms.
- Building trust requires more openness and willingness from the government.
Source: icaew.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
