CIOT: Low Incomes Tax Reform Group: PBR Hidden Economy Advisory Group comment
The Low Incomes Tax Reform Group (LITRG) has welcomed today’s announcement that a Hidden Economy Advisory Group will be set up, to “examine the tax system and HMRC’s administrative processes and consider whether they facilitate or prevent people from joining the formal economy”.
LITRG believes that many people who work without declaring their earnings do so not with any intent to deceive, but because working for such low wages they cannot afford both to pay tax and to lose their benefits.
LITRG Technical Director, Robin Williamson, said:
“Much could be done to ease the situation by enabling welfare claimants to earn more while still receiving benefits, or by synchronising the national minimum wage with the point at which people start to pay tax and NIC or start to receive working tax credit.
“In short, the weak links in the tax and benefits system are a contributory cause of the hidden economy; strengthening those links would help people who feel themselves trapped in informal work.”
Notes to editors
The Low Incomes Tax Reform Group (LITRG) is an initiative of the Chartered Institute of Taxation (CIOT) to give a voice to the unrepresented. Since 1998 LITRG has been working to improve the policy and processes of the tax, tax credits and associated welfare systems for the benefit of those on low incomes.
The CIOT is a charity and the leading professional body in the United Kingdom concerned solely with taxation. The CIOT’s primary purpose is to promote education and study of the administration and practice of taxation. One of the key aims is to achieve a better, more efficient, tax system for all affected by it – taxpayers, advisers and the authorities.
Contact – George Crozier on 020 7340 0569 or 07740 477374 (gcrozier@tax.org.uk) or Robin Williamson on 07876 030481 (rwilliamson@litrg.org.uk)
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