It is a brave person who will predict what will happen to the UK tax system in over two years’ time but I am prepared to stick my neck out and say that Income Tax will not be abolished.
The area of greatest potential change is VAT because pretty well all of our VAT rules are based on EU rules.
There are at least 10 changes which are almost certain as they deal with trade within the EU, for example:
• Abolition of Intrastat and EC sales lists (but what will replace them?)
• New rules to cover importing from and export to EU countries
We will no longer have to have VAT rates within the bounds set by the EU but this could mean that certain VAT rates could rise or fall.
Our direct taxes (income tax, corporation tax, capital gains tax etc.) are less likely to change because of Brexit as they are not based on much EU law.
Whatever the changes are they will be based on the normal drivers we see behind any change in our tax system:
• Balancing the books
• A desire to change behavior
• Political expediency
Seasoned with a (very) small dash of “simplification”! Find out more from your Local AIMS Accountant