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Government Securities (Overseas Holders)

Volume 928: debated on Friday 18 March 1977

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asked the Chancellor of the Exchequer whether, in the light of improvements in the present and prospective external financial position of the United Kingdom economy, he will consider discontinuing the arrangements under which overseas holders of Government securities are exempted from tax.

Yes. I have decided that, until further notice, the Treasury will not make any further issues of new Government securities on the terms which have become customary in recent years and under which the securities are exempted from United Kingdom taxation present or future so long as they are in the beneficial ownership of persons not ordinarily resident or for certain purposes neither domiciled nor ordinarily resident in the United Kingdom. There is no question, however, of withdrawing any exemption that attaches to outstanding gilt-edged stocks. Overseas holders of Government securities will continue to be exempted or relieved from United Kingdom tax where this is provided for by the Tax Acts or a double taxation agreement, and the change will not affect any immunity to which overseas Governments may be entitled under international law.