"Lots of juicy carrots and one very large stick"
Commenting on the business tax measures in today’s budget, Chris Morgan, head of tax policy, at KPMG in the UK, said:
“Overall this was a business-friendly budget on tax. There were lots of juicy tax carrots, and a very large stick.
“The ‘carrots’ were a corporation tax rate cut, a national insurance allowance for small businesses, an extension of the CGT holiday for seed enterprise and an extension of the creative sector tax reliefs. The ‘very large stick’ comes in the form of a raft of anti-avoidance measures. These include the widely anticipated General Anti-Abuse Rule plus details of rules on the government only awarding procurement contracts to business that are compliant on tax.
“The government has reiterated that it intends to deliver the most competitive tax system in the G20. It is on track to do that as evidenced by our own KPMG survey issued earlier this year. What they have also made crystal clear is that they will not tolerate non-compliance on tax. The Chancellor has yet again spelled out his ‘play fair by us and we’ll play fair by you’ policy on business tax.”
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.