Charlie Elphicke – 2014 Parliamentary Question to the HM Treasury

The below Parliamentary question was asked by Charlie Elphicke on 2014-06-12.

To ask Mr Chancellor of the Exchequer, if he will make it his policy to introduce a clause into private finance initiative contracts to limit the ability of contractors to move offshore.

Danny Alexander

The Government is committed to effective anti-avoidance rules to ensure that profits arising on UK activities are not artificially diverted to low tax jurisdictions. At the same time, it needs to ensure that the tax system is competitive for all companies and has set out its plans to make the UK an attractive place to do business while retaining proportionate anti-avoidance protection.

UK resident PFI contractors regardless of their shareholders’ registered jurisdiction will be charged UK corporation tax on profits earned within the UK. To limit the freedoms properly available to investors would be anti-competitive and contrary to European Union law. These points are not unique to the Private Finance Initiative (PFI) but apply equally to non-PFI companies and investors.