Tax collection devolution warning by councils

Wales will have tax raising powers from 2018 but it is not yet known who will collect them

Local councils could collect new Welsh taxes, but warned they may struggle to meet the devolution deadline due to reorganisation.

Powers to levy a land transaction tax to replace stamp duty and a landfill disposals tax take effect in 2018.

The assembly's finance committee said it was "disappointed" by the situation and called for a "phased approach".

It means HMRC could continue collecting the devolved taxes until councils or another body was judged to be ready.

'Degree of uncertainty'

The Welsh Local Government Association (WLGA) told the committee that councils were "best placed" to collect and manage devolved taxes.

However, it warned that the "degree of uncertainty" over the process of mergers and boundary changes would make it "extremely difficult ... to commit to new responsibilities from 2018".

Publishing a report on Thursday, committee chairwoman Jocelyn Davies said it could not take a "firm view" on who should collect Welsh taxes because of a lack of detailed costings.

She added: "We hope the expertise of local government will be utilised in the coming years to ensure an integrated tax system is developed in Wales."

The Welsh government said a Tax Collection and Management Bill would be published before the summer and more information on costings would be provided.