You do not expect members of the The House of Lords (aka God’s Waiting Room) to be revolutionaries.
But about Corporate Tax that’s what they are.
They are Ermined Revolutionaries.
The Lords’ Select Committee on Economic Affairs has today published Tackling corporate tax avoidance in a global economy: is a new approach needed?
Their answer to the question is YES!!! IT IS!!!
Here is their top-line advice for the Treasury to consider:
- alternative tax structures (such as destination-based cash flow tax) tocurtail avoidance, promote investment and to maintain international competitiveness
- the tax treatment of debt and equity and the scope for introducing an allowance for corporate equity
- regulation of tax advisers with suitable penalties for falling short of the standards required
- the scope for penalising companies engaged in aggressive tax avoidance
- the scope for requiring companies with large operations in the UK to publish a proforma summary of their corporation tax returns to help enable Parliament and public to understand better how tax has been computed and to see when action against avoidance is needed
- adequate resourcing of HMRC to challenge the tax arrangements of large UK corporations and multinationals.
Wow! Strong stuff!
Some of these radical ideas build on the recent OECD report Action Plan on Base Erosion and Profit Shifting (Trust me it’s more interesting than it sounds).
Look out for our up-coming series of blogs on the OECD report!
Tax is hot. Your company needs to think about it!