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Treasury closes 900 million-pound energy firm tax loophole
May 29, 2013 / 8:05 PM / 4 years ago

Treasury closes 900 million-pound energy firm tax loophole

Chancellor of the Exchequer George Osborne arrives to speak at a news conference in central London May 22, 2013. REUTERS/Carl Court/POOL

LONDON (Reuters) - The Treasury closed down a 900 million-pound tax loophole on Wednesday by preventing energy firms from claiming money off their tax bills against installation costs dating back decades.

The move is the latest step in Britain’s drive to maximise tax receipts as it tries to reduce the country’s budget deficit and lead a global clampdown on aggressive tax avoidance and evasion by multinational firms and wealthy individuals.

New legislation will stop gas and electricity distributors from making new claims for tax relief against the cost of providing new or improved supply to commercial premises in cases where the bill has already been met by the company.

“It is completely unacceptable that utility companies think they can claim for huge amounts of money that business customers have already covered the cost for,” said Chancellor George Osborne.

The new law would take immediate effect as an addition to an existing finance bill, meaning new claims could not be made and the Treasury said it would “challenge robustly” those already submitted.

Reporting by William James; editing by Andrew Roche

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