The government has been urged not to rush through any merger of income tax and National Insurance Contributions (NICs) by Ellie Gamble, senior tax manager at Grant Thornton UK.

Yesterday in the Budget, Chancellor George Osborne announced a consultation on plans to merge the operation of income tax and NICs.

Gamble says: “We cautiously welcome government plans to merge the operation of income tax and NICs. This could really make life easier for both employer and employee. We would, however, urge the government not to rush anything through.

“Moreover, the change should not lead to ‘scope creep’, resulting in additional tax charges under the smoke screen of simplification. For example, employees currently don’t pay national insurance on employer-provided benefits, even though they are taxable. If this is to be changed, it must be done in the clear light of day.

“The government seems to have made up its mind about the principle of merging two duties which have for a long time been perceived as one thing, the government’s share of earnings. The consultation is just about the detail of such a merger. We would urge a measured approach to ensure that we don’t throw the baby out with the bathwater.”