Under proposed government plans, hundreds of thousands of people will no longer be hit with £100 fines for failing to complete their income tax returns on time.
This would relate to those taxpayers who miss the deadline by a day or two only.
In addition, it is being proposed that higher interest rates are charged on those who owe taxes to the Government, instead of automatic fines which are currently imposed, in order to encourage tax payers to pay on time.
A system of penalty points – similar to motoring offences – could also be introduced so that financial sanctions apply only to people who persistently fail to pay their tax bills.
The plan will be open for public comments until May, and comes after figures showed 890,000 people missed the January 31 deadline for completing their income tax self-assessments last week. They now face an escalating scale of penalties, starting with an automatic £100 fine.
In recent years, the number of people who are now required to file self-assessments has increased due to the government cuts on Child Benefit for higher rate tax payers.
