Post-Brexit: International taxation initiatives
A key question emerging from Brexit is the UK’s future involvement with the OECD and its Base Erosion and Profit Shifting (BEPS) project. With the UK a prominent advocate and supporter of the OECD’s exercise (as part of the G20) there has already been legislative action taken in a number of areas.
The UK already has detailed transfer pricing and wide ranging international anti avoidance legislation in place and will continue adoption of the OECD’s BEPS recommendations whether in or outside of the EU.
However the UK will not be subject to EU direct tax directives such as the recently announced Anti tax avoidance package and the proposed common consolidated tax base. This may lead to UK rules falling “out of sync” with EU counterparts.
In respect of existing rules, there may also be further opportunities to be had. For example, the UK is currently subject to EU non-discriminatory and state aid restrictions, which going forward the UK would not necessarily have to adopt as part of any withdrawal.
However, if the UK does seek to gain advantages through fiscal measures it may face “moral” pressures to mirror the EU position. This becomes a particularly pertinent issue if the UK wishes to retain a free trade relationship with the EU.
If you have any immediate Brexit questions please email us or send enquiry as we are interested in discussing this with you.