The government has announced it has scrapped the Valuation Office Agency in a drive to "slash inefficiencies".
Tax minister James Murray announced the planned reform saying it was designed to help to deliver the the government's "Plan for Change" by creating the conditions for growth.
The VOA will become part of HMRC to "increase efficiency, business experience and ministerial accountability" in a move that comes ahead of the government’s review of the status of hundreds of arm’s-length bodies at Whitehall and features as part of government’s Tax Update: Simplification, Administration and Reform published on 28 April.
The VOA is responsible for valuing properties for council tax and business rates. It will be brought into its parent department HM Revenue & Customs by April 2026 as the latest arm's length body to be moved into central government following the decision last month that the world’s biggest quango, NHS England, will be brought back into the Department of Health and Social Care.
Exchequer Secretary to the Treasury, James Murray, said: "We are determined to reduce the hassle of the tax system for British businesses and taxpayers. Ending the inefficiency and duplication of a standalone VOA will help us drive change faster and improve value for money. The VOA’s work supports the collection of over £60 billion in council tax and business rates each year, and also provides commercial property valuation services to the public sector.
"The move will improve the experience of taxpayers and businesses by cutting the time spent managing taxes and upgrading the customer experience during the transition to a reformed business rates system."
Thirty-nine measures to reform and simplify the tax and customs system have also been announced.
These measures include cutting red tape for small businesses by simplifying VAT administration through changes made to the VAT Capital Goods Scheme, a scheme allowing businesses to reclaim VAT on expensive capital items, based on their long-term use.
The government will also increase the threshold value for capital expenditure on land, buildings and civil engineering work from £250,000 to £600,000.
It says this will free up time and resources spent on tax administration for around 105,000 commercial properties which will be removed from the scheme.
The government has also today published a consultation on a VAT relief to encourage charitable donations.
John Webber, head of business rates at Colliers, said it was a sad day for those in the VOA "who still possess an independent mind and view".
He added: "In reality the VOA has not been independent or arm’s length for years – and this move is just confirming what we have known, that the role has become more politicised. This is disappointing when there is a recognised and actual need for a properly independent view.”
Webber continued: "Those individuals doing this role paid by HMRC will now have their professional integrity called into question.
"This is also another blow to UK plc trying to get a sensible answer on business rates. For ratepayers across the country the computer is 'going to say no' even louder.”