Nearly 4,000 large businesses can expect significantly higher tax bills upon the introduction of interest deductibility for corporation tax, says Alvarez & Marsal Taxand managing director Kevin Hindley
Renowned economist John Maynard Keynes once remarked: ‘When the facts change, I change my mind. What do you do, sir?’
Phillip Hammond seemingly, or at least in the context of corporate tax, is keeping on the course unchanged, despite new winds of uncertainty blowing across Europe.
The last-ever Autumn Statement delivered an unwelcome announcement to large businesses already grappling with the effect of Brexit by confirming the government’s intentions to implement recommendations from the OECD’s Base Erosion and Profit Shifting initiative (BEPS), restricting interest deductibility from 1 April 2017.
The overall direction of travel regarding the policy behind these rules remains largely unsurprising. Led by George Osborne, the government has already been at the forefront of the BEPS initiative, implementing the proposals enthusiastically at the earliest possible opportunity.
