HMRC dodges cuts to beef up avoidance fight | AccountingWEB

HMRC dodges cuts to beef up avoidance fight

HMRC emerged as the Chancellor’s pet department in the Autumn Statement. With billions of pounds of cuts promised for central government departments over the next two years, HMRC escaped unscathed. Instead the chancellor confirmed the £77m package to fight tax avoidance announced on Monday.


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…but nothing on Permanent Establishment so far.    1 thanks

Chaztax | | Permalink

Specifically, nothing to amend  s.148(5) FA 2003 which exempts a warehouse from being a P/E.

If this bit of legislation were amended so that, e.g. a warehouse above a certain size were henceforth a P/E, then that would (for example) bring Amazon’s UK warehouses into the scope of UK corporation tax.

Such an amendment to UK domestic law would need to take precedence over tax treaties whilst the latter were being renegotiated, but this is not an unknown concept (e.g. in the US, domestic law sometimes overrides treaties).

On the fact of it, this seems like a relatively simple way of bringing the legislation up to date and raising tax revenue at the same time.  Can any of the International CT experts out there can see a reason why this wouldn't work?