GPT delay until 2012

12/01/2011

BACTA has announced that the Treasury has decided to change the timetable and process for the Government’s plans to introduce a gross profits tax style tax.  Jenny Cowles, Deputy Director of HMRC, advised representatives from the industry that the change in tax policy would not be introduced in the Finance Bill 2011, but was intended to be introduced in the Finance Bill 2012.  

The reason given was that the Minister was concerned that many of the detailed policy design decisions required further information and consultation which could not be achieved in the one month consultation period that had been planned.  Treasury made it clear that this did not mean that the Minister was changing her mind concerning the introduction of a GPT,
but further consultation was now planned commencing in the Spring or Summer of this year and further details will be announced to the industry over the coming weeks.

According to BACTA, the practical effect upon the proposed implementation date has yet to be confirmed but the industry is clearly of the view that while the concept is in itself flawed at a time of industry crisis, any proposed
implementation should also be pushed back at least an additional 12 months.  BACTA, led by John Powell as head of the GPT working group, has been engaged at a very high level concerning the GPT issue, communicating with the Minister, Justine Greening, John Penrose and liaising with senior officials at No. 10 Downing Street and government ministers including Oliver Letwin.  ”The fight is not over, but we are extremely grateful to all of our supporters who have pulled this back
from the brink,” said the BACTA statement.  Further details will be published on the HMRC website in the immediate future and the GPT working group will be advised of next steps when we have further clarification

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