UK could soon see a general anti-avoidance rule

Date: 21st November 2011

Demand for specialist accountancy services could soon be on the rise in the UK following the recommendations of a new report.

The government is being urged to introduce a general anti-avoidance rule (GAAR) in order to increase the country's tax yield.

In a report written by Graham Aaronson QC, the government was told that a GAAR would help build trust between the UK's taxpayers and HM Revenue & Customs.

Mr Aaronson also claimed that a new GAAR would level the playing field for UK firms, deter "abusive" tax avoidance schemes and reduce legal uncertainty.

However, he claimed that any such rule would need to be targeted in order to avoid creating unnecessary confusion.

"Responsible tax planning is an essential feature in a complex tax regime, such as the UK's. But artificial and abusive tax avoidance schemes are widely regarded as an intolerable assault on the integrity of the tax regime," he explained.

"A general anti-abuse rule narrowly targeted to deter such schemes, while not affecting responsible tax planning, should lead to a fairer, more principled and ultimately simpler tax system."

Posted by Emily Smith