The consultation on the taxation of interest

It is unclear when the changes would become effective but legislation is expected in Finance Bill 2013.

Consulting on anti-avoidance measures is nothing new. Indeed last year’s consultation on tax treaty anti-avoidance proved so controversial the proposals were dropped. Many of these new proposals are aimed at perceived avoidance and it will be interesting to see to what extent HMRC changes its position in response to representations. What seems clear however is that the promise of a GAAR has not lessened HMRC’s appetite for new specific anti-avoidance rules.

The proposals include withdrawing the withholding tax exemption for ‘quoted Eurobonds’ where a bond has been issued to a company in the issuer’s group and is listed on a stock exchange...