The use of “superficial sensationalism” in the title does not represent TC supporting aggressive tax avoidance. It’s just a plea for a little more grown up journalism.
Last night’s programme on tax avoidance didn’t really help the debate….and caused me to miss Corrie!
The majority of the programme felt like an advert for a mini..and was the driver exceeding the speed limit?
That aside, a little balance wouldn’t have gone amiss.
Practitioners know that the UK tax system is over engineered. And it is this that has given rise to the loopholes to be exploited in an environment where being within the “letter of the law” was what counted. But it is also known that the game in relation to avoidance and what will and won’t be accepted has actually changed.
That is not to say that all is now perfect. Such an enormous change will take time to bed in..but maybe not that much time.
Underpinning this change is the General Anti Abuse Rule aimed at reinforcing specific anti-avoidance provisions and ensuring that the intention of parliament is enforced and not easily side-stepped.
It’s early days but this legislation represents an attempt at real change to what is and isn’t permissible in relation to avoidance.
There is real evidence that this new legislation plus the continuing “naming and shaming” plus purposive judgements in the courts and tribunals is bringing about a change to the public (individual and corporate) attitude to and appetite for avoidance.
And the GAAR wasn’t even mentioned in the programme.
David Heaton was of course – as was the Chancellor’s “grubby mitts”.
Important for advisers to remember and to reinforce with their clients is that action that is specifically contemplated by and even encouraged by legislation and is not abusive (as defined by the GAAR) will be acceptable and effective.
Future legislation on any currently effective planning cannot be ruled out of course. The possible new “anti fragmentation” rules are a good example of this.But the new zeitgeist doesn’t mean that no planning is possible or that all planning is unacceptable.
And in closing, lets not forget that there is a very delicate line for the Government to draw between “over incentivising” some businesses and individuals with tax breaks in the law that could be perceived as unfair and making the UK an environment that is a good place to do business in a way that benefits (commercially) the business, and the people of the UK.
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