Oi, UK.gov. WHERE'S THE DETAIL on your Google Tax?
Beancounters ponder how headline-grabbing idea will work in reality
Tax experts have raised "serious doubts" over the government's ability to implement a "Google Tax" in just four months.
In his Autumn Statement this week Chancellor George Osborne pledged to slap a 25 per cent tax on companies making profits in UK but diverted abroad.
However, the Treasury did not supply any more details in its accompanying 108-page document beyond the implementation date of the Diverted Profits Tax for April 2015. More substance for the proposals is expected next week.
George Bull, senior tax partner at accountancy firm Baker Tilly, said: "The government now has to produce a new tax law in the next four months and get it up and running - that is something I have serious doubts about."
He added the move was likely a pre-election sop to voters. "The government wants to be seen as being hard on tax avoidance. It's a pre-election [message] to say to the electorate it is being tough on multinationals."
The Treasury estimates the tax will initially raise £25m in 2015-16, rising incrementally to £355m by 2019-20.
Yet concerns have also been raised over the wisdom of the UK "going it alone", as the Organisation for Economic Cooperation and Development – which represents 34 countries – is already putting together a multilateral plan for tackling the most aggressive tax schemes across jurisdictions.
John Cridland, CBI Director-General, said: "International tax rules are in urgent need of updating, but the decision for the UK to go it alone, outside the OECD process, will be a concern for global businesses, and moving the goalposts on offsetting losses risks creating a worrying precedent."
However, Jolyon Maughan, tax barrister at Devereux Chambers, described the move as having the potential to unlock "radical" change.
"It is a preliminary step in what is going to be a long journey," he said.
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