M&S takes £100m Revenue fight to Europe
Marks & Spencer will take its landmark £100m tax case with the Inland Revenue to the European Court of Justice on 1 February, Accountancy Age has learned.
Link: Alison Reed steps down as FD at M&S
Marks & Spencer will take its landmark £100m tax case with the Inland Revenue to the European Court of Justice on 1 February, Accountancy Age has learned.
The struggling high-street retailer will argue that it should be able to offset losses of more than £100m, incurred in subsidiaries based in France, Belgium and Germany, against its UK profits.
If it is successful, it will be owed £30m by the Revenue. More than that, an M&S victory should ease hundreds of other company group claims in and around the loss-relief group litigation order (GLO), which comprises some of the world’s largest companies including Asda, Lloyds and BT.
A spokeswoman for M&S, which is still looking for a successor to finance director Alison Reed who steps down early next year, confirmed the case was due to be heard on 1 February.
And in what is a double whammy for the Revenue, a separate GLO against the government was referred to Europe last week by Mr Justice Park.
The so-called thin-cap litigation was referred directly to the ECJ last Thursday and contains some 15 companies, including Pepsi, Volvo and IBM.
The thin-cap case, of which Dorsey & Whitney is the lead and test case solicitor, is one of six GLOs currently at various stages of litigation. Ultimately the thin-cap litigation could cost the government well over £100m, with the overall cost of the GLOs estimated to be in the region of £20bn.
All of the GLOs claim UK tax law is in some way contrary to EC rules.