The Treasury is to consider limiting the amount of interest relief available
to private equity, in the most significant sign from the government that it is
prepared to curb the activities of the under-fire industry.
According to the FT
, the review will be announced by economic secretary
Ed Balls in a speech that
he will deliver at London Business School. In the speech Balls will say that
‘rules that apply to the use of shareholder debt where it replaces the equity
element in highly leveraged deals’ need to be re-examined.
Balls will not, however, push for a complete overhaul of the interest relief
regime, which applies to all corporates and is a feature of most developed
The speech from Balls follows intense criticism of private equity from unions
and politicians, who have accused the industry of failing to pay its fair share
of tax by loading on debt and claiming massive tax cuts on interest relief.
review will consider whether the tax system is working as intended and
investigate whether private equity investors are disguising equity as debt.
Does Darwin's theory apply to taxation? Colin ponders...
The UK tax gap fell in 2014-15 to its lowest-ever level of 6.5%, revealed official statistics published today
Changes to the tax system is urged to support the growth of entrepreneurs, found a report from the Grant Thornton UK, the Institute of Directors, and the Prelude Group
The EC has been instructed to draft a European Union (EU) directive authorising an EU financial transaction tax, which would apply to ten of the EU’s 28 member states