Investors on ‘high alert’ as OTS proposals could triple population subject to CGT
Miles Dean, Head of International Tax, comments in relation to The Office of Tax Simplification’s report into capital gains tax, in Investment Week and Forbes.
“Office of Tax Simplification (OTS) proposals published this week could see the number of UK tax payers subject to capital gains tax (CGT) triple, according to tax experts, who warn investors should be on “high alert” over the controversial plans.
The OTS plans could raise around £14bn for the public purse by cutting exemptions and doubling rates, with the government-run body arguing that the current system can “distort behaviour” as taxpayers look to reduce their bill…
Commenting on the proposals, head of international tax at Andersen Miles Dean acknowledged that taxation of capital gains has “become too complicated”, but warned that “aligning with income tax is not the answer”.
He explained: “The case for lower rates of tax on capital gains is that the asset that produces the gain is more often than not acquired using taxed income.
“To then tax the gain at income tax rates is pernicious given that the capital has been tied up.”
Dean said that aligning GCT gains with income will result in “wealthy foreigners shunning the UK, wealthy Brits leaving and the Conservatives signing their own death warrant”, adding that the country already has “myriad anti-avoidance rules to prevent income being repackaged as gains – and these provisions work”.”