'Diverted Profits Tax' to target multinationals
09 Mar 2015
Chancellor George Osborne is planning new measures to prevent tax avoidance by large companies who have avoided paying tax in the UK.
Companies such as Google, Amazon and Facebook have come under scrutiny recently for operating in the UK but diverting profits offshore. The ‘Diverted Profits Tax or ‘Google Tax’ will mean that companies judged to be avoiding HM Revenue & Customs (HMRC) will be met with a 25% penal tax rate, according to the Sunday Times.
Regular corporation tax is currently set at 20%, with the new measure proposed to be introduced by the Chancellor during his Budget Speech on 18 March.
Rumours have been circulating of what plans Mr Osborne could unveil in the Budget, which could impact the General Election in May. Further increases to the income tax personal allowance are also suspected by the Sunday Times but the Treasury is unlikely to comment before the Budget is officially announced.