Treasury could miss out on £600m due to Olympic tax breaks
Olympic corporate partners will receive temporary exemption from being considered as resident in the UK
Olympic corporate partners will receive temporary exemption from being considered as resident in the UK
MORE THAN half a billion pounds could be lost to the Exchequer due to tax breaks afforded to Olympic corporate partners.
In a report from Ethical Consumer, it estimated that £600m in tax would not be paid on £2.7bn in revenues due to exemptions running for several months for Olympics-related corporate partners and service providers.
The exemption from UK corporation tax and income tax for these companies comes into play as HMRC will not consider them as making a permanent establishment for tax purposes. However, they may still have to pay taxes in their home country.
“In a time of austerity, this is money the Exchequer can hardly afford to loose [sic], especially when it has already paid out somewhere in the region of £11 billion to fund many parts of the project,” the report stated.
A Treasury spokeswoman said: “Any country bidding to host the games agrees to certain tax exemptions. These carry no cost to the UK and without them the UK could not have won the bid.”