Tax Avoidance

Treasury written question – answered on 25th February 2021.

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Photo of The Bishop of St Albans The Bishop of St Albans Bishop

To ask Her Majesty's Government what assessment they have made of the effectiveness in deterring tax avoidance of the policies of (1) France, (2) Denmark, (3) Belgium and (4) Poland, which exclude companies (a) registered in, or (b) linked to, offshore tax havens from accessing taxpayer funded relief programmes.

Photo of Lord Agnew of Oulton Lord Agnew of Oulton Minister of State (HM Treasury), Minister of State (Cabinet Office)

The Government does not have access to information about how these other countries’ policies have been applied or the impact they have had on businesses’ behaviour, and cannot therefore comment on the policies’ effectiveness.

The Government has introduced a substantial support package, designed to be targeted at the businesses and individuals who most need support, while ensuring measures are simple, certain and introduced in a timely manner to protect livelihoods.

The Government expects everyone to act responsibly by only claiming and using support as intended and is keeping measures under regular review.

The Government continues to be at the forefront of global action to tackle tax avoidance, with a series of robust measures in place to tackle profit shifting arrangements.

Since 2010, the Government has introduced over 100 new ways to tackle tax avoidance, protecting over £200 billion that would have otherwise gone unpaid. That has included adopting many of the Organisation for Economic Co-operation and Development’s Base Erosion and Profit Shifting (BEPS) Project’s recommendations including the Corporate Interest Restriction rules, effective from April 2017, which raise approximately £1 billion a year and the Hybrid mismatch rules, effective from January 2017, which are expected to raise £900 million between 2016/17 and 2020/21.

The Government has also led on implementing international standards in tax transparency, including the Common Reporting Standard and Country-by-Country Reporting (‘CbCR’), which ensure tax authorities have the information they need to identify and challenge avoidance.

As part of the Finance Act 2016, large corporations and multinational enterprises are already required to publish a tax strategy document, which (amongst other things) outlines the company’s attitude towards tax planning and its approach towards its dealings with HMRC.

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