Nicosia, Cyprus (9th October, 2012) – Xenophontos & Associates, one of the leading accounting and auditing firms in Cyprus, comments as the Office of Tax Simplification proposes wide-scale changes to the UK’s tax system.
The Office of Tax Simplification (OTS) was launched in July 2010 to provide the Government with independent advice on simplifying the UK tax system.
John Whiting, Tax Director of the OTS, has reported to the journal of the Institute of Chartered Accountants in England and Wales, ‘Economia’, that he believes the UK’s current tax legislation is overcomplicated.
Mr Whiting claims that the current system involves tax legislation processes being recorded very specifically, and if tax legislation isn’t explained “absolutely precisely”, the system simply “doesn’t work.” He argues that this leaves much potential room for error, and thus an increase in the amount of people trying to work through or around any legislative gaps. In turn, he says, this will result in the introduction of further and more complex anti-avoidance legislation.
As a solution, Mr Whiting claimed that a more “principles-based” legislative system could help make tax laws less complicated, concluding: “I think the government is slightly stuck with tradition… maybe we need to have a big think.”
Andreas Xenophontos, Managing Director at Xenophontos & Associates, agreed to the need to move towards a more simplified tax system.
He said: “Broadening the tax base to remove the social and industrial policies that have eroded the tax system is a good step towards a simpler tax system which promotes more growth.
“Simplification of the tax system means that more decision-making in our economy will be economically efficient, rather than tax-motivated. As a result, tax compliance costs will decrease, the tax base will be broadened, and lower tax rates will be required to collect the same amount of tax revenue.
“Although this will initially have a negative impact to professional tax advisors like us, in the medium to longer term, it will lead to the creation of more business and more work for accountants and tax advisors.”
For more information on Xenophontos & Associates’ accountancy services, please visit www.xenophontos-associates.com.
About Xenophontos & Associates:
A.A. Xenophontos & Associates are a firm of Chartered Accountants located in Latsia, Nicosia and is included among the most respected accounting and auditing firms in Cyprus. The firm offers a wide range of services, including accounting, auditing, tax planning and compliance, financial studies, payroll services, VAT, trusteeship/ nominee services and company formation, trust formation, help with obtaining Cyprus Investment Firm licence, help with obtaining Cyprus residence permits, company liquidation and strike-off services.
A. A. Xenophontos & Associates
79, G. Kranidioti Avenue
2nd Floor, Office 204
CY-2231 Latsia, Nicosia
Tel: ++357 7000 0066