Stability and predictability are important aspects of a competitive tax system. This Government has acted to increase stability and predictability by introducing the ‘Protocol on unscheduled announcements of changes in tax Law’ in the Budget 2011 document entitled ‘Tackling tax avoidance’. The protocol makes it clear that fully retrospective legislation will be “wholly exceptional” and limited to circumstances where:
A significant amount of tax is at stake;
There is a history of abuse of this area of the legislation;
There has been a clear statement of policy in the area;
A clear warning has been given that retrospective action would be taken if abuse of specific legislation continued.
Representations received by this Government relating to section 58 and the stability and predictability of the U K tax system have come from users of the wholly artificial tax scheme to which section 58 applies and from their representatives.