Power boss blasts UK tax regime

Power boss blasts UK tax regime

UK's corporate regime branded as 'uncompetitive' by one of UK's largest taxpayers

Steve Lucas, FD of National Grid

Steve Lucas, FD of National Grid

The finance director of
National Grid has
become the latest senior figure to criticise the UK’s corporate tax regime, as
the government enters a make-or-break consultation into its foreign profits
plans.

Steve Lucas told Accountancy Age this week that the UK is
‘uncompetitive’ on tax.

‘Frankly the UK is uncompetitive. The trend [of business moving their tax
bases offshore] is not at all surprising,’ said Lucas. ‘Our assets are rooted to
the ground here so we’re very highly regulated. Our regulators would take a very
dim view of us moving our tax base.’

National Grid is
the 12th largest taxpayer in the UK, Lucas said, and his comments come as the
Treasury comes under huge pressure to perform a U-turn on its plans to tax the
foreign profits of UK multi-nationals.

Chancellor Alistair Darling and other Treasury ministers were on a charm
offensive this week to persuade businesses of the impact of the proposals,
saying that their plans were ‘revenue-neutral’ and that the government was
considering the impact of the reforms carefully.

The government announced the make-up of its high-level committee to mull over
the proposals this week.
Where it had previously called in tax directors from some of the largest
multi-nationals to discuss the new rules, the new committee features CFOs
including Dr Byron Grote of BP and Rolls-Royce’s Andrew Shilston.

A group of economists, from the CBI, the TUC, Oxford University and HM
Revenue & Customs, are also on board. Its first meeting is expected to be in
June.

Advisers were surprised that some major critics of the government were not on
the committee.

Referring to the consultation in general, Deloitte’s Bill Dodwell said: ‘I
think it has been handled badly but if we end up with a different policy that
will be a victory rather than a climbdown.’

The government faces weeks of intensive lobbying from big business before
announcing its final plans before the summer recess.

‘[The passive income rules] would be compliance heavy because you will have
to hunt around for
that “bad” income and separate it from the “good” income,’ said John Cullinane,
Deloitte’s financial services partner.

Share

Subscribe to get your daily business insights

Resources & Whitepapers

Why Professional Services Firms Should Ditch Folders and Embrace Metadata
Professional Services

Why Professional Services Firms Should Ditch Folders and Embrace Metadata

3y

Why Professional Services Firms Should Ditch Folde...

In the past decade, the professional services industry has transformed significantly. Digital disruptions, increased competition, and changing market ...

View resource
2 Vital keys to Remaining Competitive for Professional Services Firms

2 Vital keys to Remaining Competitive for Professional Services Firms

3y

2 Vital keys to Remaining Competitive for Professi...

In recent months, professional services firms are facing more pressure than ever to deliver value to clients. Often, clients look at the firms own inf...

View resource
Turn Accounts Payable into a value-engine
Accounting Firms

Turn Accounts Payable into a value-engine

3y

Turn Accounts Payable into a value-engine

In a world of instant results and automated workloads, the potential for AP to drive insights and transform results is enormous. But, if you’re still ...

View resource
Digital Links: A guide to MTD in 2021
Making Tax Digital

Digital Links: A guide to MTD in 2021

3y

Digital Links: A guide to MTD in 2021

The first phase of Making Tax Digital (MTD) saw the requirement for the digital submission of the VAT Return using compliant software. That’s now behi...

View resource