A general anti-avoidance principle is in sight

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The General Anti-Avoidance Principle I drafted was not officially on the agenda during the Finance Bill debate yesterday – but Michael Meacher and John Pugh in combination made very sure it was debated none the less – and for a considerable period of time – until Stephen Timms said:

If we were to go down the road of issuing a general rule or principle, we would have to consider a range of factors: the impact on certainty for people and companies, the issue of whether a clearance system would be needed, the effect on the rest of the tax code and whether we would need to repeal parts of that code. Countries such as Australia that have general anti-avoidance rules often find that they still need some specific rules in addition to support the overall scheme, so we would also need to reflect on that. We would certainly need a full consultation before we opted for such an arrangement. I am nevertheless grateful to those who have raised this important topic—one that we must keep within our sights.

Inch by inch we make progress towards a tax system that will beat tax avoidance.

By thanks to Michael Meacher and John Pugh for their tenacity.