asked Her Majesty's Government:
Following the decision on 12 September by the European Court of Justice in the case brought by Cadbury Schweppes plc, what is their estimate of (a) the amount of corporation tax in respect of years up to and including 2005-06 that will not now be payable by United Kingdom resident companies; and (b) the impact on estimated corporation tax receipts for years after 2005-06 compared with the estimates included in the last Budget Statement. [HL7416]
The Government confirmed on 12 September that they are studying the detail of the judgment carefully and will announce as soon as possible what, if any, changes to the UK’s controlled foreign companies rules are needed to sustain their effectiveness in protecting tax revenues.
The UK has the lowest headline corporation tax rate among the G7 leading industrial economies. The UK remains a highly competitive location for investment, based on both tax and other factors, receiving more foreign direct investment than any other country apart from the US.