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One minute with… Karl Mah

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What’s keeping you busy at work?

Our practice is largely transaction driven and over the past decade the volume of deals in London has significantly increased, in line with the growth of our London office. One of the great things about being a tax lawyer is the variety of work that we get involved in, which means that there is rarely a dull moment. For example, this week most of my time has been spent working on a private equity auction process, a complex restructuring for a corporate group and a receivables securitisation.

If you could make one change to a tax law or practice, what would it be?

To pick only one change is tough. In the domestic context, I think that there needs to be a general acknowledgement that the UK tax code has developed piecemeal over a prolonged period of time, and in the context of increasingly rapid societal change. But viewed in that light, I would say that UK tax law is not as deficient as some commentators might suggest.

The need for change in the law should be balanced against the resources of the tax authority. Given this constraint, I think it would be more productive to focus on strengthening the relationship between the tax authority and tax advisers. So much recent UK tax legislation seems to start from the harmful premise that the taxpayer is out to dodge its obligations to pay; for example, even the recent Budget contained a general proposal that large businesses should notify HMRC ‘when they take a tax position which HMRC is likely to challenge’. This starting point no doubt influences the passing of anti-avoidance legislation which is drafted so broadly that it can easily capture genuine commercial transactions, and this cannot be to anyone’s benefit.

Has a recent case has caught your eye?

An interesting Court of Appeal decision from last year was Aozora [2019] EWCA Civ 1643, which relates to the extent to which a taxpayer can place reliance on HMRC’s published guidance. Although it was perhaps unsurprising that the Court of Appeal upheld the decision of the High Court in rejecting the taxpayer appellant’s arguments, there is a wider practical issue in terms of how HMRC and tax advisers approach recently enacted, highly complex legislation. There is a view within the profession that tax legislation tends to be rushed through, with advisers then potentially having to look to HMRC for guidance in order to iron out the legislative defects. The hybrid mismatch rules are a good example of this – though the related HMRC guidance adds more confusion than clarity in places!

Is there anything you know now that you wish you’d known at the start of your career?

There are undoubtedly a lot of things, but one that springs to mind is the importance of maintaining good mental and physical health, both for yourself and for the people you work with. It’s all too easy to burn out doing this job.

What should we look out for in 2020?

At the time of writing, I don’t think that anyone can be sure of the extent to which the COVID-19 pandemic will dominate the outlook for 2020 (with the effect that various tax developments take a back seat).

Setting that aside, there are several major tax developments on the horizon this year. At the top of the list is the OECD’s final proposal for tackling the challenges arising from the digital economy, which has the potential to result in groundbreaking changes to the international tax system. It will also be fascinating to see what happens to the new digital services tax in the UK in light of ongoing trade negotiations with the US. From US law firm perspective, it is always interesting to look out for tax changes connected with the upcoming presidential election in November.

You might not know this about me…

I’m turning 40 this year. Ten years ago, I would have struggled to run 400 meters without stopping, so I’m going to attempt to mark the occasion by running a half marathon. If I decide to enter full mid-life crisis territory at 50 by upgrading to an Ironman, please stop me.

Issue: 1481
Categories: One minute with