The predictions come after a ruling by the Advocate General of the European Court of Justice in the so-called Bosal case which would mean EU member states can no longer operate different systems for taxing national and multinational companies. In effect, UK companies could in future claim for tax relief on losses incurred at subsidiaries in other EU states.

Experts believe the ruling - if confirmed by the ECJ, as seems likely - could leave the Revenue facing claims going back six years with a total value running into billions. 'The court is telling us you can't have one rule for national and another for international companies,' said Adam Craig, head of the EU Group at Deloitte & Touche.

The case began when Bosal Holdings, a Dutch company, claimed it was entitled to tax deductions at home for the interest charges incurred on loans taken out to acquire interests in a German company, a claim backed by the ECJ.