The report, published on 16 June 2023, acknowledges that the UK tax system is overcomplicated and is creating unnecessary compliance burdens, confusion and disincentives to work or grow a business. In short, it describes the tax system as an obstacle to economic dynamism.

Examples mentioned in the report include the complexity of the R&D tax relief regime and cliff edges in the tax system (particularly around the £100,000–£150,000 income range) which, at worst, could result in someone becoming worse off by earning more money.

The report notes the Chancellor’s agreement that the trend for the tax system to become ever more complicated must be reversed. It observes that disbanding the OTS risks signalling that tax simplification is not a priority for the government.

Members of the committee tabled report stage amendments to the Finance Bill. One of these seeks to place a statutory requirement on the Treasury to report annually to the committee on actions taken to simplify the tax system. Such reports would include information on steps to:

• simplify existing taxes, tax reliefs and allowances; 
• simplify new taxes, tax reliefs and allowances; 
• engage with stakeholders to understand needs for tax simplification; and 
• develop metrics to measure performance on tax simplification, and on performance against those metrics.

The report concludes: "Should the Government proceed with abolishing the OTS, we recommend they report to the Treasury Committee annually on steps taken to simplify the tax system, covering both new and existing taxes. Such reports should set out performance against tax simplification metrics, compare the complexity of the UK tax system with other countries and set out what the Treasury has done to understand taxpayer needs for tax simplification."