§ Mr. Grylls
asked the Prime Minister if she raised the issue of unitary taxation during her recent meeting with United States Treasury Secretary Donald Regan; and if she will make a statement.
§ The Prime Minister
My right hon. Friend the Chancellor of the Exchequer and I both raised the issue of unitary taxation at our meeting with United States Treasury Secretary Regan in London on 8 December. At my meeting with Secretary Regan I repeated my view that unitary taxation is not a fair basis for the taxation of multinational companies, that the proper method of calculating profits is on an arm's length basis and that we were looking to the US Administration for a speedy and acceptable resolution of the problem. We discussed the progress of the working group established to investigate this issue. I was glad to note Secretary Regan's assurance that at its public hearing on 6 December there was a willingness by states and companies to resolve differences and an understanding that this issue was causing difficulties for the United States Government with its trading partners.