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Taxation: Electronic Government

Question for Treasury

UIN HL7410, tabled on 27 July 2020

To ask Her Majesty's Government what assessment they have made of the impact of the Making Tax Digital programme on the productivity of the self-employed.

Answered on

10 August 2020

The Government expects the Making Tax Digital programme to have a positive impact on the productivity of self-employed businesses, as set out in the Financial Secretary to the Treasury’s written ministerial statement on 21 July (HCWS400) and HMRC and HM Treasury’s publication “Building a trusted, modern tax administration” of the same date.

About 1.4 million businesses, some of whom are self-employed, have already joined Making Tax Digital (MTD) for their VAT affairs and many of these are already experiencing productivity gains associated with more digital ways of working, as set out in HMRC’s Evaluation of the MTD for VAT service published in March.

The Enterprise Research Centre (2018) found that for micro-businesses, web-based accounting software delivered productivity increases of over 10%.

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