Brussels, 04/07/2016 (Agence Europe) - The international community fears that once it has left the EU, the United Kingdom will become a tax haven on the doorstep of Europe.
On Monday 4 July, the Chancellor of the Exchequer, George Osborne, told the Financial Times that he wanted to create a “super-competitive economy” based on low business taxes, for example. He also said that he hoped to reduce the corporate tax rate to below 15%, to show investors that the UK is still “open for business”. These announcements come as an internal OECD memo, drafted by Pascal Saint-Amans on 24 June and revealed by the news agency Reuters, expresses concern at the fact that the negative impact of Brexit on British competitiveness may push the country to be “even more aggressive in its tax offer”. “A further step in that direction would really turn the UK into a tax haven type of economy”, states Saint-Amans, the brain behind the BEPS action plan of the OECD to fight aggressive corporate tax planning. Saint-Amans is also reported to have stated that London could not afford to cut taxes too much due to pressure on public finances. Again according to Reuters, another internal OECD memo states that the United Kingdom could be planning to revise its rules to remove the burden of VAT on the financial services industry, to give the City of London a major competitive advantage.
On behalf of ACCA, the organisation representing accounting experts, Chas Roy-Chowdhury said that any change to UK tax policy should be closely aligned with what the EU does, “at least in the short term, simply because that will create much greater certainty for businesses”. For its part, the European Commission declined to comment. (Original version in French by Elodie Lamer)