Weekly tax brief | 8 June 2021

G7 tax agreement was driven by mutual need. What happens next?
George Bull
News that G7 finance ministers have reached a political agreement on global tax reform has reverberated around the world. The prospect that the largest multinational tech giants will pay their fair share of tax in the countries in which they operate has been widely welcomed. We look at the detail and explore aspects of the agreement which will not be so easy to implement in practice.

Will the consultation on R&D tax incentives go far enough?
Sheetal Sanghvi
In March’s budget the government announced one of the broadest consultations on the future of R&D tax incentives. Launched over 20 years ago, a review of this scheme was long overdue and is very welcome, but it remains to be seen whether the outcomes will do enough to ensure R&D tax reliefs are fit for the future.

Will a residential property developer tax achieve its goal?
Shirley McIntosh
Residential property developers will be concerned at yet more tax increases, but will an attempt to raise funds for post-Grenfell housing remediation work do more harm than good to an already stretched housing supply?

HMRC to endorse tax avoidance schemes?
Sarah Saunders
Should HMRC identify firms providing ‘good’ tax avoidance schemes?  It is a possible solution to certain avoidance vehicles, but would it work?

Is the UK sacrificing global trade relations in the pursuit of net zero?
Sheena McGuinness
Carbon border tax (CBT) is a much publicised and hotly debated topic among global policy makers. CBT supporters argue that the levy protects manufacturers of goods in countries having a high domestic carbon tax (such as the UK and EU member states) from imports from more polluting jurisdictions. Opponents view this as protectionism. The UK government is considering a CBT. Whilst ideologically fairer, in practice could such a regime do more harm than good to the British economy?