The ECA has voiced its anger at the latest developments made by the Inland Revenue in its revision of the Construction Industry Scheme.
ECA representatives have condemned the Inland Revenue's insistence on starting the new electronic-based Construction Industry Scheme (CIS) in April 2005. At the fourth Construction Industry Reform Advisory Panel (CIRAP) meeting, representatives again voiced their opinions that the date is unrealistic in view of the requirements to train staff and obtain computer software.

This debate comes in the wake of the Inland Revenue's (IR) rejection of the ECA's proposal to abolish the scheme completely. It claims the reasons for its introduction still remain part of construction business culture in some quarters, and would involve unacceptable risks of tax loss.

The new scheme will dispense with personal visits to IR offices, with call centres being set up to deal with queries. The IR has also stated that returns should be provided by contractors on a monthly basis in line with the tax months, either on paper or electronically. These returns will be a statutory requirement, even for nil returns. The IR says a decision on whether penalties will be imposed for not making a return will be publicised to the industry at an early stage.

The IR has agreed with industry representatives that the issuing of subcontractor statements would probably be confusing and that it may push staff to saturation point. Also, industry proposals to transfer all existing CIS users to the new scheme and cleanse the records of non-users after the transfer have been accepted.

The IR has passed on industry suggestions about publicity for the new scheme to its marketing and communications section for development.

Source

Electrical and Mechanical Contractor