The steady change of focus has come about as more and more breaches of EU law have been unearthed, prompting multinational companies to reclaim their overpaid tax.
PricewaterhouseCoopers confirmed that its EU tax group, which is headed up by Peter Cussons, would be a strong area of growth going forward. ‘Is this a growth area of PwC? Yes, most definitely,’ said a spokeswoman.
The head of KPMG’s EU tax group, Chris Morgan, said his department has increased in size over the last two years. ‘We are seeing that companies are now recognising that the EU touches all aspects of taxation,’ he said.
David Evans, a director in the international tax department of Ernst & Young, said that EU tax was ‘becoming more and more second nature’ and ‘mainstream’. It has led to the growth in EU-related tax disputes across the entire industry.
Evans went on to say that, while the UK had woken up to the possibilities on offer from breaches of EU tax law, it was still a long way behind the Benelux countries. ‘Northern Europe, especially the UK, was a bit slow off the mark on this,’ he said.
Six group litigation orders are currently at various stages of litigation, all of which relate to UK tax law apparently contravening the Treaty of Rome. If successfully fought, the GLOs could cost the UK Treasury as much as £20bn in refunds and interest.
Deloitte and KPMG have also ramped up their international tax departments over the past 12 months.
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