FInancial services focus
Contributors
The UK has long prized its reputation as an attractive place to do business. Successive governments of all persuasions have consistently taken measures to make sure the UK has the most competitive corporate tax regime across the G20. With its low headline corporate tax rate and generous rules on deductibility of interest compared to other G20 partners, the UK has been ideally positioned as a place for businesses to invest and thrive.
However, two recent developments look set to alter the UK’s traditional approach. Globally, the OECD has proposed a range of measures aimed at combating what it calls aggressive tax planning under the umbrella of the base erosion and profit shifting (BEPS) initiative. Domestically, the UK government is seeking to balance the need to maintain its business-friendly reputation with the political desire to clamp down on those which the UK government sees as taking unfair advantage of the UK tax system.
