On Wednesday 29 March, the government delivered a letter to the president of the European Council, triggering TEU Article 50 to begin the formal process for the UK’s exit from the EU.
Commenting on what to expect from a tax perspective, Dominic Stuttaford, head of tax at Norton Rose Fulbright, said: ‘what businesses look for is certainty and while nothing will change until the UK formally exits the EU, companies will be considering the potential implications’. Businesses will be looking particularly at the indirect tax consequences and whether there is any additional vat or customs duty, although this, Stuttaford added: ‘will not be clear for some time’.
Businesses are ‘starting to consider whether they have to reorganise their groups as a result of the possible impact of Brexit’, which will involve consideration of both immediate tax consequences and any longer-term increase in their effective tax rate.
The House of Commons justice committee has published a report on the implications of Brexit for the Crown Dependencies, which calls for more clarity. Priorities would include: protection of financial services from EU blacklisting; retention of the common travel area; and continued export opportunities in agriculture, fisheries and manufacturing. The report recommends that the government clarify its position on what might happen to agreements the UK has with the Crown Dependencies on developing their international identity if, as a result of Brexit, ‘those diverge from the UK’s own interests’.