We are pleased to be here to help the committee with its examination of the considerable work that has been done and is in train to implement the Scotland Act 2012.
Revenue Scotland, which was established by the Revenue Scotland and Tax Powers Act 2014, has an important part to play in the implementation of the 2012 act. In January 2015, it will become a separate body in the Scottish Administration, and, like bodies such as the Scottish Court Service and Registers of Scotland, it will be operationally independent of the Scottish ministers and will be directly accountable to the Scottish Parliament. Revenue Scotland will be ready to administer both the assessment and collection of the devolved taxes from April 2015 and the subsequent compliance regime.
The effective collection of devolved taxes in Scotland relies on the creation of the right conditions, which includes a principle-based approach to taxation, where the spirit as well as the letter of the law must be upheld by taxpayers and their agents. In June 2012, the cabinet secretary set out his approach, which is based on Adam Smith’s four maxims. Those have underpinned all the work to establish the devolved taxes in Scotland.
A further condition is, obviously, the programme of robust legislation, which commands a high degree of consensus. For example, the Revenue Scotland and Tax Powers Act 2014 received unanimous approval at each stage from the Finance Committee and the whole Parliament.
Another condition is active engagement with the appropriate stakeholder communities. For the two devolved taxes, agents of land and buildings transaction tax payers, landfill site operators and a range of professional bodies will continue to participate to inform policy formulation and guide operational implementation. That will mean that operational processes will be user friendly. At the heart of that activity in Scotland are the tax consultation forum and the devolved tax collaborative, which are accessible, broad-based, issue-specific working groups that are unique to the Scottish approach.
The final key condition is good governance of the tax administration processes. The tax administration programme and Revenue Scotland have been established to deliver those processes—and they will.
We are now seeing the final stages of the journey that began in June 2012 when the cabinet secretary announced in Parliament his decision to establish a tax authority for Scotland.
In the words of the Auditor General,
“there are now well-developed project plans for implementing the devolved taxes.”
Using those plans, Revenue Scotland has provided online tax calculators so that people can work out the tax that is due based on the proposed rates and bands. It has launched its website and developed a core information technology system to process tax returns and the associated case management—the system is currently subject to internal testing. It has also finalised payment systems and banking arrangements. It is currently consulting users on the drafting of technical guidance for taxpayers for both the devolved taxes. It has a fully staffed programme team so that it can continue programme delivery, and it is recruiting staff for operational delivery as and when they are needed.
Positive actions are being delivered thick and fast. My colleagues and I are well placed to help the committee with its exploration of the opportunities and risks, and to set out the robust actions that are in place to manage and mitigate them. All of us and our teams are highly motivated and committed to delivering the effective collection and administration of taxation from 1 April next year.
I will introduce my colleagues. Eleanor Emberson has been head of Revenue Scotland since October 2012, and is the chair of the tax administration programme board. She is the former chief executive of the Scottish Court Service. John King is business development director at Registers of Scotland and lead for ROS on the tax administration programme board. He has been with ROS for 30 years. John Kenny is head of national operations at SEPA and is the lead for SEPA on the tax administration programme board. He has been with SEPA since its inception 18 years ago.
As you know, I am the director general of finance at the Scottish Government. I chair the fiscal responsibility programme board, and I am happy to cover the other aspects of the implementation of the Scotland Act 2012 that sit outside the scope of Revenue Scotland.