UK-based multinationals would be allowed to repatriate billions of pounds of foreign profits tax-free to the UK, under proposals being drawn up by the Treasury to improve the competitiveness of the British tax system. The Treasury will issue a consultation paper this spring on the option of bringing the British system into line with mainland Europe, which does not tax foreign dividends. The potential reforms – which are not expected to result in an overall tax cut for companies – are likely to be accompanied by stringent anti-avoidance measures and potential new restrictions on the deductibility of interest costs.

This entry was posted by Gwen Robinson on Wednesday, April 11th, 2007 at 5:43 and is filed under Capital markets. Edit this entry.