A GENERAL anti-abuse rule (GAAR) will be consulted on and implemented next year with the aim of stopping firms and individuals using “aggressive” tax avoidance schemes.
George Osborne described tax evasion and extreme tax avoidance as “morally repugnant,” saying he wants firms to respect parliament’s will.
The rule is expected to be based on a report from Graeme Aaronson QC, which recommended a system that should distinguish between standard tax planning strategies and more adventurous schemes which stretch legal definitions.
“There will be concerns on uncertainty for normal business transactions though because people’s views differ on this highly subjective and emotive area,” said PwC tax partner Mary Monfries.
“This is something businesses and people with complicated tax affairs will be worried about, so the consultation period will be important.”