On 7 November 2017, the Office of Tax Simplification (OTS) published its first report on VAT, setting out a range of proposals for simplifying the tax. The report contains 23recommendations.

The OTS’s core recommendations are:

• the government should examine the current approach to the level and design of the VAT registration threshold, with a view to setting out a future direction of travel for the threshold, including consideration of the potential benefits of a smoothing mechanism;

• HMRC should maintain a programme for further improving the clarity of its guidance and its responsiveness to requests for rulings in areas of uncertainty;

• HMRC should consider ways of reducing the uncertainty and day to day administration of VAT;

• HM Treasury and HMRC should undertake a comprehensive review of the reduced rate, zerorate and exemption schedules, working with the support of the OTS; and

• HMRC should consider further ways to simplify partial exemption calculations and improve the process of making and agreeing special method applications.

The report is available to view here.