Global corporates will face tougher regulations on their tax affairs going forward, with the diverted profits tax coming into effect next month, chancellor George Osborne has announced.
In his March 2015 budget speech, Osborne confirmed the new tougher tax on big business, aimed at global corporates such as Google and Amazon that are often perceived not to pay their fair share of tax to the UK Treasury.
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The announcement will be welcomed by smaller domestic businesses, many of whom have been asking the chancellor to “level the playing field” on tax for some time.
Unruly co-founder and COO Sarah Wood has welcomed the move, but has warned that the implementation of the regulation will ultimately determine how effective it will be.
“In practice, the devil is in the detail. If there’s too much complexity or subjectivity involved in defining avoidance then any punitive levy will be difficult to identify and expensive to enforce,” she warned.
Further reading on tax: Does tax avoidance by large corporates put SMEs at a disadvantage?