TaxCorporate TaxICAS warns of double taxation over planning gains

ICAS warns of double taxation over planning gains

ICAS warns that planning gains supplement in Scotland could lead to double taxation

The government’s proposal for a planning gains supplement could cause double
taxation, warns ICAS.

The institute has raised concerns that the proposal for a tax to be levied on
the gains from granting planning consent could be double taxation.

Colin Lamb, convener of the
ICAS
Capital Taxes Sub-Committee
, said Scottish local authorities currently
expect developers to help out with infrastructure costs from their planning
gain, an issue that could lead to developers effectively getting taxed twice.

‘In contrast to the position in England, there is no sign yet that the
Scottish Executive has taken steps to ensure a scaling back of these payments
following introduction of the new tax. This could result in effective double
taxation on planning gains in Scotland,’ said Lamb.

‘Even if local authorities could be persuaded in principle to reduce the
obligations they currently impose, the absence of any mechanism in Scotland for
channelling the new tax revenue back to those same local authorities is likely
to discourage them from doing so.’

ICAS has proposed a ‘developer’s credit’ that can be offset against the
planning gain supplement where local authorities insist on higher contributions
than those South of the border.

ICAS was responding to
consultations
by HM Revenue & Customs and the
Valuation Office
Agency
.

Further reading:

ECJ opens door for investment trust VAT windfall

Mayflower Theatre wins key VAT appeal

Profile: Clare Hartnell, Grant Thornton’s
head of property and construction

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