Multinationals in summer limbo over tax cases

A high-level tax group headed by the UK that aims to restrict the impact of
European Court of Justice rulings on EU national exchequers will not meet until
September or October.

The UK government is leading discussions aimed at limiting the impact of a
range of corporate tax cases, involving companies such as Marks & Spencer,
Cadbury Schweppes and Deutsche Bank.

Any meeting to debate the issues concerned will not, however, take place
until after the summer break in August, a spokeswoman for the Treasury told
Accountancy Age. The group’s discussions are also likely to be secret, she

The government’s attempts to address the threat to its revenues posed by ECJ
tax cases has attracted huge interest. Accountancy Age revealed last year that
the UK government alone could face losses of up to £20bn if a whole raft of
corporate tax cases went against it. Other member states could face even greater
bills, it is understood.

‘All member states will be invited [to the discussions],’ the spokeswoman
said. No specific date or agenda has yet been set.

The UK took on the presidency of the EU last week, meaning it has greater
powers to drive the agenda.

Revenue & Customs is anxiously awaiting an ECJ ruling on the M&S
case, one of the first to be ruled on by the European court.

Earlier this year, the advocate general suggested that UK tax law, which
denied M&S the opportunity to claim losses in France against UK profits, was
illegal. The advocate general’s decision is followed by the court in most cases.

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