Consultation on draft regulations to transfer the Scottish Tax Tribunals to the Scottish Tribunals

Part 2: Draft Regulations Transferring The Functions And Members Of The Scottish Tax Tribunals To The Scottish Tribunals

3. This consultation seeks your views on draft regulations that transfer the functions and members of the First-tier Tax Tribunal to the First-tier Tribunal and transfer the functions and members of the Upper Tax Tribunal for Scotland to the Upper Tribunal for Scotland. It also seeks your views on draft regulations that repeal existing regulations regarding the Scottish Tax Tribunals made under powers contained in the Revenue Scotland and Tax Powers Act 2014.

Background

4. Section 28(2) of the 2014 Act provides the power for the Scottish Ministers to make regulations to transfer the functions of the listed tribunals in Schedule 1 of the 2014 Act, to the First-tier Tribunal only; the Upper Tribunal only; or to the First-tier Tribunal and the Upper Tribunal.

5. Schedule 2 (see section 29) of the 2014 Act provides the power for the Scottish Ministers to make regulations to transfer the members of the listed tribunals to the First-tier or Upper Tribunals.

6. Section 80 of the 2014 Act allows Scottish Ministers to make such supplemental, incidental, consequential, transitional, transitory or saving provision as they consider necessary or expedient for the purposes of or in connection with the 2014 Act.

Overview of Draft Regulations

7. The policy intent is for the tax tribunals to transfer into the Scottish Tribunals structure with their existing membership and functions in so far as practicable. Upon transfer the Scottish Tax Tribunals will be abolished and thereafter first instance decisions will be heard in the First-tier Tribunal Tax Chamber with onward appeal to the Upper Tribunal. Complex tax cases will be heard at first instance by the Upper Tribunal. Appeals in these cases will be heard by the Court of Session.

8. The draft regulations contained in Annexes A and B provide for:

• the transfer of functions of the Scottish Tax Tribunals to the Scottish Tribunals;
• Transitional arrangements to regulate how cases pending, in progress and new cases will be dealt with;
• Consequential amendments and repeals required in light of the transfer of functions;
• the transfer of legal and ordinary members of the Scottish Tax Tribunals to the Scottish Tribunals.

9. The draft regulations contained in Annex C repeal part 4 and schedule 2 of the Revenue Scotland and Tax Powers Act 2014. The draft regulations also repeal the following regulations as their provisions are covered in the 2014 Act or in regulations made under that Act:

• Scottish Tax Tribunals (Conduct and Fitness Assessment Tribunal) Rules 2015.
• Scottish Tax Tribunals (Time Limits and Rules of Procedure) Regulations 2015
• Scottish Tax Tribunals (Eligibility for Appointment) Regulations 2014
• Scottish Tax Tribunals (Voting and Offences etc.) Regulations 2015

10. The draft regulations are attached at Annexes A, B and C.

Transfer of functions of the Scottish Tax Tribunals

11. It is proposed that the functions of the First-tier Tax Tribunal will transfer to the First-tier Tribunal with allocation to the Tax Chamber and that the functions of the Upper Tax Tribunal will transfer to the Upper Tribunal.

12. The draft regulations maintain the appeal route for complex first instance cases referred to the Upper Tribunal so that they may be appealed to the Court of Session.

Transitional arrangements

13. We propose that from 1 April 2017 all applications to the First-tier Tax Tribunal will transfer to the First-tier Tribunal. Cases in progress on the day of transfer will be continued in the First-tier Tribunal. If a hearing is in progress then it will be completed by the First-tier Tribunal comprised of the same members, where possible. Time limits which have started to run prior to commencement of these regulations and have not expired shall continue to apply.

14. If a party wishes to appeal a decision of the First-tier Tax Tribunal but has not exercised this right before 1 April 2017 then the appeal route will be to the Upper Tribunal as opposed to the Upper Tax Tribunal. We propose that if a party has already exercised their right of appeal before 1

15. April 2017 then this will also be transferred to the Upper Tribunal as the Upper Tax Tribunal will be abolished.

Transfer of members

16. The policy intent is for existing members of the Scottish Tax Tribunals to transfer into the Scottish Tribunals. Members will be subject to terms and conditions to be offered by Scottish Ministers.

17. The draft regulations propose that legal members of the First-tier Tax Tribunal will transfer in as legal members of the First-tier Tribunal. Legal members of the Upper Tax Tribunal will transfer in as legal members of the Upper Tribunal. Ordinary members of the First-tier Tax Tribunal will transfer in as ordinary members of the First-tier Tribunal with allocation to the Tax Chamber.

18. As there is currently no President of the Scottish Tax Tribunals (the post is being filled meantime by a temporary President), it is not specified in the regulations that the Tax Tribunal President will transfer into the Scottish Tribunals as the Chamber President of the First-tier Tax Chamber. The Judicial Appointments Board for Scotland is currently undertaking a recruitment exercise to recommend the appointment of a permanent Chamber President of the Tax Chamber. It is envisaged that this appointment will commence on 1 April 2017 to coincide with the transfer-in of the jurisdiction.

Questions on the transfer of the Scottish tax tribunals

Q1: Do you have any comments on the draft transfer of functions and members Regulations?

Q2: Are you content with the provisions regarding transitional arrangements?

Q3: Are you content with the provisions relating to the transfer of functions and members?

Q4: Do you have any other comments you wish to make?