This article was first published in the Tax Journal on Monday 29th October 2018.
In 1973, when the UK acceded to the EU, the new legal order profoundly affected the interpretation of UK statutes, including tax statues. The infringement procedure has often led to changes in UK law, although not always to the extent initially requested. Corporation tax has become the best-known area of EU influence, with litigation over dividends, tax credits, cross-border tax relief and controlled foreign companies. EU law necessarily governs VAT, although member states are given considerable discretion both by the legislator and the courts. The doctrine of abuse of right derives from the EU legal order but the UK has played a major role in developing it. EU law has affected the activity of tax authorities, the structure of the system of appeals and the permitted structure of taxes, as well as substantive tax law. HMRC has become used to cooperation between tax authorities in the single market, and a role for EU law may arise through the terms of the EU/UK trade agreement, as well as through domestic legislation.
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