Financial Regulatory Forum

UK seeks to reassure businesses on corporate tax

By Adrian Croft

LONDON, Feb 22 (Reuters) – Britain launched a consultation on Monday aimed at giving companies more clarity on any likely changes to tax laws as it seeks to reassure multinationals that the UK remains a competitive place to locate their business.

“Businesses want certainty on tax. That is why today I have set out, in collaboration with UK business, the government’s key principles for tax policy and how we will engage with business when developing tax policy,” finance minister Alistair Darling said.

The framework aims to ensure that UK tax is competitive, fair, minimises distortions to commercial decisions, and is predictable and simple with low compliance costs, the finance ministry said.

Paul Walsh, chief executive of Diageo Plc, the world’s largest spirits maker, made headlines this month when he said tax increases in Britain, where the company is based, could force him to consider moving Diageo’s headquarters.

The consultation was aimed at other multinational companies including HSBC, Unilever, BP and Axa, which want clarity on Britain’s tax measures to plan investment.

New Zealand aims to align tax rates, boost capital markets

WELLINGTON, Feb 18 (Reuters) – New Zealand wants to align tax rates paid by company, individual and trusts to improve the country’s economic performance and is also looking at policies to boost its capital markets, government ministers said on Thursday.

Finance Minister Bill English said his government’s medium-term goal was to have company, trust and top personal rates at the same level, but was looking to see if such a move was affordable and fair.

“Our early advice is that aligning the trust and top personal tax rates is the most important issue,” he told a business group, adding that substantial gains could be made from this with the company tax rate not too far below.

Obama tones down international corporate tax aims

WASHINGTON, Feb 1 (Reuters) – President Barack Obama appeared to scale back his ambitious plan to close loopholes global companies use when accounting for taxes on profit earned overseas in his 2011 budget blueprint released on Monday.

Obama, who has used heated rhetoric to blast corporations that keep profits overseas to avoid U.S. tax, proposed changes that he said would raise $122 billion over a decade.

He mentioned the issue in his State of the Union address last week, saying: “To encourage these (energy and manufacturing companies) and other businesses to stay within our borders, it’s time to finally slash the tax breaks for companies that ship our jobs overseas and give those tax breaks to companies that create jobs in the United States of America.”

Companies to disclose iffy tax estimates – IRS

By Kim Dixon

WASHINGTON, Jan 26 (Reuters) – U.S. tax authorities will soon demand that corporations reveal much more detailed financial information about tax shelters and other complex structures when they file their income taxes, the top U.S. tax official said on Tuesday.

Under new draft guidance, the Internal Revenue Service would require companies to report which tax positions they take that could be “uncertain” or challenged by the IRS.

“These taxpayers would be required to annually disclose uncertain tax positions in the form of a concise description of those positions and the maximum amount of U.S. income tax exposure if the taxpayer’s position is not sustained,” IRS Commissioner Doug Shulman said in remarks prepared for a speech to lawyers in New York in announcing the plan.

House tax chief to press Geithner on corporate tax

By Kim Dixon

WASHINGTON, Dec 8 (Reuters) – The head of the tax-writing House of Representatives Ways and Means Committee will press Treasury Secretary Timothy Geithner this week to back a plan to cut corporate tax rates and pay for it by closing offshore tax loopholes.