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US Treasury announces steps to counter inversions

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The US Department of the Treasury and the Internal Revenue Service (IRS) announced they are taking action to tackle corporate tax inversions. In a statement issued from Washington DC, Treasury secretary Jacob J. Lew said: ‘These first, targeted steps make substantial progress in constraining the creative techniques used to avoid US taxes, both in terms of meaningfully reducing the economic benefits of inversions after the fact, and when possible, stopping them altogether.

While comprehensive business tax reform that includes specific anti-inversion provisions is the best way to address the recent surge of inversions, we cannot wait to address this problem. The Treasury will continue to review a broad range of authorities for further anti-inversion measures as part of our continued work to close loopholes that allow some taxpayers to avoid paying their fair share.’

According to The Daily Telegraph (22 September), the move ‘could scupper tens of billions of dollars-worth of deals already in the pipeline’. The share prices of several British firms, including AstraZeneca, Shire and Smith & Nephew, fell following the news.

Issue: 1232
Categories: News