Building pressure (TT Sep08 p19-21)

The pressures for change in how foreign profits are taxed in the UK have been building for some time. Some of the pressure arises from the need to improve the international competitiveness of the UK tax regime, especially the controlled foreign companies (CFC) rules, which have come under attack for being too complex and far-reaching. The CFC regime has been in existence for more than 20 years and has been amended almost every year since its creation, which has obscured its original stated purpose. However, the most significant pressure on the government in this area has come from recent decisions of the European Court of Justice (ECJ).

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