- Oct 12, 2009
- Reaction score
- New Jersey
- Political Leaning
- Libertarian - Right
CNBC said:The UK's tax collection agency is putting forth a proposal that all employers send employee paychecks to the government, after which the government would deduct what it deems as the appropriate tax and pay the employees by bank transfer.
The proposal by Her Majesty's Revenue and Customs (HMRC) stresses the need for employers to provide real-time information to the government so that it can monitor all payments and make a better assessment of whether the correct tax is being paid.
Currently employers withhold tax and pay the government, providing information at the end of the year, a system know as Pay as You Earn (PAYE). There is no option for those employees to refuse withholding and individually file a tax return at the end of the year.
If the real-time information plan works, it further proposes that employers hand over employee salaries to the government first.
"The next step could be to use (real-time) information as the basis for centralizing the calculation and deduction of tax," HMRC said in a July discussion paper.
HMRC described the plan as "radical" as it would be a huge change from the current system that has been largely unchanged for 66 years.*
The employers send employee checks to the government and the government decides how much the employee gets.
Concerns are security and recovery of employee money in case of a mistake. No apparent concern about handing over paychecks to the government.
Now take the poll.