The much-anticipated consultation document on interest relief, controlled-foreign companies and foreign dividends is expected to be launched by the Treasury in late June or early July.

According to PricewaterhouseCoopers , the crucial consultation was initially scheduled for early spring but is now more likely to be announced next month or even in July.

In a release on the firm's PwC Plus site, it said: 'While the expected date of its publication had slipped to mid-June, it now seems likely that it may not arrive until late June or even early July.'

The consultation follows significant victories in the European Court of Justice for Cadbury Schweppes on CFCs, M&S on group loss relief and an decision on franked investment income . These cases have meant that great swathes of UK tax law is untenable. 

According to PwC, the consultation will be 'the most important issue in the international tax arena for the next few years'. Pressure has been mounting on the government to acknowledge the decisions in Europe and respond to the UK tax competitiveness debate.

The consultation could see the Treasury consider limiting interest relief on debt, or limiting the scope of CFC rules through specific legislation.

The consultation was first announced in the 2007 Budget and follows informal consultation on the various issues.

Further reading:

Treasury moves to keep UK tax system competitive

ECJ forces review of multi-national tax

Tax relief measures 'will make UK less attractive'