Stocks and Shares: Channel Islands

(asked on 14th September 2017) - View Source

Question to the HM Treasury:

To ask Mr Chancellor of the Exchequer, if he will bring forward legislative proposals (a) to amend section 841 of the UK Income and Corporation Taxes Act 1988 to withdraw recognition of the securities issued at the Channel Islands Stock Exchange and (b) under which UK companies would be required to withhold 20 per cent from the payment of interest to all Jersey-based companies and remit that sum to HM Revenue and Customs.


Answered by
Mel Stride Portrait
Mel Stride
Secretary of State for Work and Pensions
This question was answered on 12th October 2017

The quoted Eurobond exemption is a longstanding exemption which enables UK companies to access investment capital from foreign markets and reduces frictions in financial markets. In response to concerns about the use of interest payments to shift taxable profits overseas, the Government has recently introduced a restriction on the deductibility of corporate interest expense. The rules ensure that companies cannot use excess deductions for interest expense to reduce their taxable profits and erode the UK tax base. This is forecast to raise approx. £1bn per annum.

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