Responding to the announcement of a forthcoming review of value added tax (VAT) by the Office of Tax Simplification (OTS), Mike Cherry, Federation of Small Businesses (FSB) national chairman, said: “Complying with VAT obligations is massively time-consuming for small firms. Over a quarter identify it as the most complex tax to deal with.
“Small firms aren’t like big corporations – they don’t have accounting expertise on tap. Our small business owners should be spending their time and money growing their firms, not navigating an array of different VAT schemes and an inconsistent list of exemptions as long as your arm.
“VAT should also not be used as a back-door to bringing more firms into mandatory quarterly tax reporting.
“Given that the VAT regime is so awash with complexity, there needs to be substantial simplification before any more small firms are brought into its scope.
“It’s promising to hear that an OTS review of VAT is on the way and we are calling for it to have simplification, not threshold reduction, front and centre.”