The previous government’s innovation of yet one more Isa, the so-called “British Isa”, also just adds more layers of complexity. It should bite the dust.
But something must be done about the lack of domestic investor interest in the UK. I chaired the board of Pensions World in the 1990s — then the official journal of the National Association of Pension Funds, now rebranded the Pensions and Lifetime Savings Association, another name that does not trip off the tongue lightly. I await its next rebranding with interest.
My board members’ companies’ investments alone accounted for half the value of the UK stock market.
Times have long since changed. Diversification is now the name of the game for both institutional and retail investors, but the playing field is tilted against UK investment. There is no UK stamp duty on the purchase of overseas shares — although foreign jurisdictions may impose their own tax.
Why not abolish stamp duty levied at 0.5 per cent on the purchase of UK shares? That would give a much-needed boost to UK-based companies and a fillip to the London Stock Exchange.
Tidy up the law on stamp duty. Why is there is no UK stamp duty on international shares, buying UK gilts or corporate bonds, or buying initial public offerings, or exchange traded funds, or Aim shares?
Shake up HMRC customer service
The whole infrastructure of tax is creaking at the seams. Customers and their advisers are let down by poor HM Revenue & Customs customer service — the National Audit Office has found that its telephone service is not delivering, with an average wait time of nearly 23 minutes in the first 11 months of 2023-24.
At the very minimum at this Budget, the chancellor should set absolute standards, which HMRC must meet or all senior staff bonuses be withheld. To add insult to injury, at least eight HMRC senior staff had five-figure bonuses in 2022-23. I would be ashamed to take one penny in bonuses when taxpayers cumulatively spent 798 years on hold waiting to speak with them in 2022-23, according to the NAO.
Taxpayers do not ring up HMRC usually on routine queries that they can find the answer to on the internet. Many are either complex queries that need human assistance or the person has no internet access.
Better customer service would bring in more cash in a timely fashion — people, if they could talk to a real HMRC human, would no longer bury their head in the sand when it comes to filing tax returns on time.
Free online training for the over-65s
The government could also help itself with a final push to get the entire nation online. We are nearly there but not quite yet. Make a special effort to reach out with free education for pensioners. They are often the people with assets and complex tax affairs but still too many are digitally illiterate.
