Commenting on today’s discussion document from HMRC, Jane McCormick, head of tax at KPMG in the UK, said:
“Today’s discussion document from HMRC on tax and procurement is a significant development.
“The announcement was not unexpected and it is not surprising in the current environment that the government should take all measures at its disposal to discourage tax avoidance and encourage greater transparency on tax.
“However, we can foresee some difficulties with the draft proposals as currently presented, in particular around the treatment of UK and foreign suppliers. There is the potential to create an ‘unlevel playing field’ disadvantaging British-based companies because suppliers with tax obligations in foreign jurisdictions will be required to certify that there has not been an ‘occasion of non compliance’ in relation to the equivalent foreign tax rules. So whether or not there has been such an occasion will clearly rest on the rules pertaining to the various territories which are not uniform from country to country. Specifically, many countries do not have a General Anti-Avoidance/Abuse Rule or a disclosure of tax avoidance schemes (DOTAS) regime.
“Assessing the full impact of today’s proposals is difficult at this stage as it is very early days and increased clarity in certain areas is needed. There is a short consultation process on the proposals running from now until the end of the month and we would encourage all businesses engaged in or bidding for government contracts to pay close attention to today’s proposals and participate fully in the consultation process.”
-Ends-
For further information please contact:
Margot Cowhig, KPMG Corporate Communications
Tel: 0207 694 4246 Mobile: 07920 274856: margot.cowhig@kpmg.co.uk
KPMG Press Office: 0207 694 8773
Notes to editors.
About KPMG:
KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and operates from 22 offices across the UK with over 12,000 partners and staff. The UK firm recorded a turnover of £1.8 billion in the year ended September 2012. KPMG is a global network of professional firms providing Audit, Tax, and Advisory services. We operate in 156 countries and have 152,000 professionals working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. KPMG International provides no client services.
