May 03, 2006

EU Tax

The EU may be hobbling since the rejection of the Constitution Treaty, but integration still continues. The EU Serf has the latest on Tax Harmonisation, this has been chugging along for a while with several companies trying to use EU rules to mean that they can offset losses in offshore subsidiaries against profits at home to lower their overal tax bill. Not unexpectedly the ECJ has found against the government as it always tends to rule in such a way as to transfer the maximum amount of power to the EU. Many companies are going to use this to reduce their tax burden and so this is going to blow a hole in Gordon Browns expected tax receipts. Since there is no way that he would reduce, or ever just slow the rate of increase, the amount spent by the state we can expect more tax rises to cover it.


Blogger Devil's Kitchen said...

Private Eye reckons that the liabilities of the current cases will amount to no less than £7 billion.

Needless to say, this figure was not accounted for in Gordo's last budget...


10:55 pm  

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