Budget took account of GLO risk

Gordon Brown has insisted he factored in the amount of money at risk from multinational companies challenging the UK tax system under European law when he prepared his Budget.

Link: Revenue at the European Court of Justice

While the Treasury refused to reveal the exact amount it calculated, accountants believe that the total at risk from the six ongoing group litigation orders could be as high as £20bn.

The news came a week before the European court was due to give an interim decision in the Marks & Spencer loss relief case. M&S is arguing that it should be allowed to offset losses incurred in foreign subsidiaries against UK profits.

Brown told the Treasury select committee that challenges to UK tax law had been taken ‘into account’ when preparing his Budget.

The government is facing six lawsuits from hundreds of UK and foreign companies, which claim that UK tax law is discriminatory and inconsistent with other EU states.

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