Tax man Varney to respond to complaints

The Government will respond to complaints today by businesses over the aggressive attitude adopted by the merged Revenue & Customs when it unveils plans to provide greater certainty and speed in its operation.

Gordon Brown commissioned Sir David Varney, a former chairman of HMRC, to review the way it dealt with the tax implications of large businesses' commercial decisions. In a move that will be seen as the Treasury offering an olive branch to business leaders, Gordon Brown will endorse the findings of the review.

Its key findings are likely to be:

* a new system of advance rulings by HMRC on its view of the tax implications of significant business decisions before they are made;

* where business decisions have a tax implication and whenever there is uncertainty, HMRC aim to provide a binding view within a standard 28 days;

* a more efficient risk-based approach to dealing with enquiries that ensure key issues are addressed first; and

* HMRC will halve the time it takes to settle transfer-pricing enquiries to 18 months.

Business leaders welcomed the results of the inquiry. "The relationship between business and HMRC has been a cause for growing concern to the business community in recent times," said Richard Lambert, director-general of the CBI.

"What is promised now is a more transparent, open and predictable approach, and one where problems will be dealt with in a timely manner."

However the CBI said that while it was a useful first step, its members were still concerned about the complexity of complying with a growing number of tax laws, and at the overall increase in the tax burden.