PwC wins green light for £300m stamp duty battle
PwC advising on group litigation order against the taxman for stamp duty charged on cross- border share issues, a move which the firm says is unlawful
PwC has won the High Court’s backing for a group litigation order to
challenge stamp duty levied by the taxman on cross-border share issues, a move
which the firm says is unlawful.
Public UK companies were hit with the tax when they issued shares on foreign
stock exchanges.
Claims issued to date exceed £150m but if compound interest is tacked on, the
Treasury’s exposure could double to around £300m. PwC said.
However further claims could see the Treasury fork out more than £500m, PwC
added.
“PwC Legal and PwC will work together to support clients to recover tax
unlawfully levied and to seek to restore them to a just position. The GLO is a
critical step in that process,” the firm said today.
The GLO has been granted a year after a European Court of Justice ruling
which said a 1.5% charge on issues of shares into a clearance service, which is
used to hold shares traded on a foreign stock exchange, was contrary to EU law.
Paul Emery, stamp taxes director, PwC, added:
“This is a tax on UK public companies accessing US and other capital markets
that is not imposed on their European counterparts, meaning UK companies are
unfairly disadvantaged in accessing foreign capital. The ability of UK companies
to raise finance freely as appropriate is critical to their competitiveness.
“The ramifications of a pending GLO go far beyond monetary value – it is also
a matter of putting right the wrong to ensure the UK remains a competitive place
to do business.”
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