The UK's Institute for Fiscal Studies has published a report into the country's Stamp Duty regime which elaborates on its argument that this is an economically inefficient tax which is easily evaded by wealthy individuals and corporations with good tax advisers.
It reduces the efficiency of the stock market for UK listed companies and distorts merger activity, says the report, producing a bias to overseas rather than UK ownership. The most practical alternative, reducing the distortion to investment decisions, would be to increase the corporation tax rate, says the IFS, adding that this is very unlikely to happen.
Indeed, the Treasury brought in some additional anti-avoidance provisions in this year's finance bill, estimating that they would increase the take of Stamp Duty by £150m a year, primarily by making it more difficult to disguise commercial property transactions through corporate manipulation. It is now more difficult, for instance, to transfer a property into a subsidiary and dispose if it through a sale of the shares in the subsidiary - previously a popular means of avoiding the 3% Stamp Duty.
Quite so, but an increase in corporation tax would hardly be politically popular,
and with no signs of Treasury sympathy for the abolitionists' arguments, the
battle appears to have a long way to run.
The right-wing Institute of Directors, on the other hand, warns that British entry into the euro would almost certainly lead to tax increases for UK homeowners. IoD Chief Economist, Graham Leach says that Britain's housing market, which is currently more competitive than the markets in the majority of eurozone countries, would likely be hit by huge tax increases if the United Kingdom joins the single currency:
'Giving up control of interest rates means that the government could be forced to consider sharp increases in property taxes in order to avoid serious house price inflation,' he explained, saying that Britain's housing market has lower levels of stamp duty than many other European countries, and zero VAT on housing, compared with an 18% VAT rate in France.
Left-wing 'bash-the-rich' newspaper the Guardian uses the structure of the tax to show how rich people 'are costing Britain millions in lost tax by not registering their houses in their own names, according to land registry records and independent accountants' estimates'. Many of their homes are registered as belonging to offshore trusts with concealed beneficiaries in order to escaping some or all of inheritance tax, stamp duty and capital gains tax, says the newspaper, attacking Baroness Thatcher among other notables.
.
Network Tweets
Network BlogsContent
provided by
|
Archive | Resources | Partners | Site Map | Links | Newsletter Archive | Contact | RSS Feeds | About | Syndication | Advertising & Marketing | Recruitment | Terms & Conditions | Privacy
Copyright © 2012 - All Rights Reserved - Tax-News.com
IMPORTANT NOTICE: Tax-News.com has taken reasonable care in sourcing and presenting the information contained on this site, but accepts no responsibility for any financial or other loss or damage that may result from its use. In particular, users of the site are advised to take appropriate professional advice before committing themselves to involvement in offshore jurisdictions, offshore trusts or offshore investments.
Write a comment