Treasury could miss out on £600m due to Olympic tax breaks
Olympic corporate partners will receive temporary exemption from being considered as resident in the UK
MORE THAN half a billion pounds could be lost to the Exchequer due to tax breaks afforded to Olympic corporate partners.
In a report from Ethical Consumer, it estimated that £600m in tax would not be paid on £2.7bn in revenues due to exemptions running for several months for Olympics-related corporate partners and service providers.
The exemption from UK corporation tax and income tax for these companies comes into play as HMRC will not consider them as making a permanent establishment for tax purposes. However, they may still have to pay taxes in their home country.
“In a time of austerity, this is money the Exchequer can hardly afford to loose [sic], especially when it has already paid out somewhere in the region of £11 billion to fund many parts of the project,” the report stated.
A Treasury spokeswoman said: “Any country bidding to host the games agrees to certain tax exemptions. These carry no cost to the UK and without them the UK could not have won the bid.”