Tax system 'completely inadequate' in digital age, says UKHospitality

By Stuart Stone contact

- Last updated on GMT

Tax overhaul: UKHospitality has called for the Government to ensure transactions on online platforms are taxed appropriately
Tax overhaul: UKHospitality has called for the Government to ensure transactions on online platforms are taxed appropriately
UKHospitality has called on the Government to provide greater equality in the tax system by making sure that transactions on online platforms are taxed appropriately.

The hospitality industry body responded to HMRC’s consultation on online platforms’ role in ensuring tax compliance by their users.

UKHospitality recommended “greater provision of information for smaller users and, if necessary, the tax collection for, and payment to, Government (as a business service)” and “a requirement for large-scale users to proactively provide HMRC with relevant business activity to ensure tax compliance”.

UKHospitality chief executive Kate Nicholls said: “There needs to be a level playing field between online and property-based businesses and digital companies.

“The current tax system is completely inadequate to deal with the complexities of the digital age, and hospitality businesses find themselves at a disadvantage.

“The Government must address this inequality and this includes ensuring that the appropriate tax is collected when online platforms are used.

“Whether through ignorance or as a result of deliberate avoidance, online transactions are frequently not subjected to tax.

“As it stands, there is too great an opportunity for online transactions to avoid paying tax. Not only does this deprive the exchequer of vital tax revenues, it creates a plainly unfair disparity between online and hospitality businesses that must comply with rigorous legislation.

“The Government must ensure a tax environment that is fair and transparent. We need an overhaul of the tax system to reflect the way in which business is carried out in the 21st century and we need it now.”

Related topics: Legislation, Technology

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