Tax advisers prepared to open GAAR talks

Gordon Brown won an important battle this week in his fight against tax
avoidance, as a raft of tax advisers advocated a discussion about introducing a
general anti-avoidance rule in the UK, writes Alex Hawkes.

The profession has long opposed a GAAR, which would mean all schemes to avoid
tax would have to be cleared with Revenue & Customs.

This week, however, the Scots’ institute publicly urged the chancellor to
open discussions about introducing one, a move backed by senior tax advisers.

John Whiting, tax partner at PwC, told Accountancy Age: ‘It’s time to start
talking about talking.’

The Chartered Institute of Taxation, Whiting disclosed, intends to include a
proposal for discussion in its budget submissions for next year.

Chas Roy-Chowdhury, head of taxation at ACCA, said the association’s tax
committee had recently discussed a GAAR. ‘Things have got so bad with the
worsening of tax legislation it is almost as though a GAAR would start being
more attractive,’ he said.

Both Roy-Chowdhury and Whiting indicated they had yet to be convinced it was
the solution, and specified that a GAAR would have to come with the withdrawal
of current legislation and proper clearance procedures.

The shift in thinking comes after a spate of anti-avoidance legislation,
raising criticisms from advisers that ‘mini-GAARs’ were being introduced.

Ironically, the Revenue is so pleased with the success of its anti-avoidance
moves and disclosure regime that a GAAR is unlikely to be on its agenda.

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