Richard recently contributed to a debate n the House of Commons on International Trade & Geopolitics in which global taxation was one of the topics discussed.
Speaking after the debate, Richard Fuller MP said:
Many global companies have a lot of leeway in how and where they declare their profits. Governments of the major economies want to “fix” this problem by introducing a “global minimum” tax rate and for taxes to paid in the counties where revenues are earned.
I agree that some companies - particularly tech companies- have been too aggressive and our tax laws- particularly on intellectual property - need to be tighter. I am not sure the UK is wise to “outsource” corporate tax policy to OECD agreements however. The UK tends to gold plate such treaty rules whilst others are less stringent. So who is going to check the details to ensure policy is consistent in all jurisdictions?
I also worry that this policy will be more advantageous to countries with large manufacturing sectors where the accounting rules on depreciation (investment costs that can be deducted from profits that are taxable) are more generous than for services focused economies such as the U.K. Have we thought through the implications for our competitiveness ?
Richard's contribution to the debate can be watched here.
