HC Deb 26 June 1990 vol 175 cc134-5W
Mr. Nicholas Brown

To ask the Chancellor of the Exchequer when he last raised the issue of unitary taxation at a European Council of Finance Ministers meeting.

Mr. Lilley

The European Community continues to take an active interest in unitary taxation and last June, the Government played a prominent part in the Community demarche on unitary tax to the United States Treasury. In response, the United States Treasury said that the issue of unitary taxation remained of serious concern to the Administration of President Bush and that further progress was required before federal concerns on this matter could be put to rest.

Mr. Nicholas Brown

To ask the Chancellor of the Exchequer when the joint Government and United States administration review on unitary tax will be completed.

Mr. Lilley

It is anticipated that the joint review with the United States Treasury on unitary tax will be completed this summer.

Mr. Nicholas Brown

To ask the Chancellor of the Exchequer what direct action Her Majesty's Government will take to support the efforts of British business with regard to legislation being considered by the Californian legislature on unitary tax.

Mr. Lilley

The Government are fully aware of the difficulties which unitary tax still causes for British businesses and fully support further legislative reform in California. In this connection, my right hon. Friend the Chancellor of the Exchequer wrote earlier this year to Secretary Brady at the United States Treasury and Governor Deukmejian in advance of a small delegation of senior Government officials to California to assess the situation as part of the unitary tax review.

Mr. Nicholas Brown

To ask the Chancellor of the Exchequer what progress has been made in negotiating an amendment to the United Kingdom-United States double taxation treaty on unitary tax.

Mr. Lilley

The United Kingdom sought such an amendment in the 1970s, only for the United States Senate to refuse to ratify such a provision. The United States authorities have in the last few years made it clear that they were looking for progress towards resolving the unitary tax issue in California rather than at federal level. They have, however, equally made it clear that further progress is required before federal concerns on the issue can be put to rest.