Tax expert warns measure to clamp down on profit shifting will ‘destroy’ UK reinsurance industry
George Osborne has confirmed he is pressing ahead with the so called ‘Google tax’ on companies that shift profits around the world, which one expert has warned threatens to ‘destroy’ the UK reinsurance industry.
In his Budget speech, the Chancellor of the Exchequer announced that the government would introduce legislation next week for the new Diverted Profits Tax, which is targeted at multinationals that he said ‘artificially shift their profits offshore’.
Howard Jones, Head of Insurance Tax Services at Mazars said earlier this week that the global profit shifting tax will “in its present drafted state destroy the UK reinsurance industry.”
As part of a wider drive to reduce tax avoidance by £3.1bn, Osborne said the government will close loopholes to ensure that Entrepreneurs Relief from capital gains tax will only be available to those selling ‘genuine stakes’ in businesses.