§ Sir Michael GryllsTo ask the Chancellor of the Exchequer if he will make a statement following the United States Supreme Court decision on Barclays bank.
§ Mr. DorrellMy right hon. and learned Friend and I were naturally disappointed by the Supreme Court's decision on the Barclays case. The Government have always strongly opposed the imposition of world-wide unitary tax on United Kingdom-owned companies and supported Barclays throughout this litigation.
As my right hon. and learned Friend said last September, the legislation passed by California to modify its tax law is a major step forward and it should ensure that in future no United Kingdom-owned company is exposed to damage there from the imposition of world-wide unitary tax. We will be following closely the detailed regulations and the practical implementation of this law. I share the concerns of British business that the details of the Californian legislation have not yet been fully implemented. Consequently, the United Kingdom will retain its retaliatory powers against the possibility that states might damage United Kingdom-owned companies at some time in the future.
My right hon. and learned Friend and I also welcome the clear commitment to the internationally accepted arm's-length principle which has been shown by the Federal Administration. We regard such support for the international consensus as of major importance in expanding trade and investment throughout the world.