WASHINGTON – The Information Technology Industry Council (ITI), the global voice for the tech sector representing 60 of the world’s leading technology companies, issued the following statement from President and CEO Dean Garfield today on the United Kingdom’s proposed problematic diverted profits tax:
“The United Kingdom’s proposed diverted profits tax will simply serve to deter and divert new investments from the U.K. We are deeply disappointed to see the U.K. take such a reckless approach to taxation in aiming to install a new 25 percent tax on a poorly defined idea of ‘diverted profits.’ There are systems in place to avoid and deter this very sort of behavior. Governments regularly negotiate tax treaties; governments negotiate agreements with businesses, and most recently, the Organisation for Economic Cooperation and Development (OECD) has been engaged in the BEPS Project. While the business community may have reservations about BEPS, at the very least, it seeks to respect and work within the framework of tax treaties and other agreements already in place. We cannot say the same for the U.K.’s tax proposal.
Protectionism is an obstruction in today's global economy and this approach smacks of protectionism. It is rather unfortunate that instead of taking positive action to attract foreign investment into the U.K., the Chancellor has decided to take aim at multinational corporations, particularly the tech sector which makes significant investments, employing millions and enabling growth in all sectors of the global economy from manufacturing to finance to retail.”
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