UK: UK Leaving The EU: Direct And Indirect Tax Implications - The Potential Impact Of A Brexit On Tax

Following negotiations, a vote in favour of leaving the EU could have significant implications for direct and indirect tax in the UK.

Overview

In the short term, a vote in favour of leaving the EU will have little, if any, immediate impact on indirect or direct taxes. Few changes are likely to occur while the secession negotiations take place. Following a negotiation about exit terms, the UK's approach to taxation could diverge from the current position.

Key findings

The paper analyses the direct and indirect tax implications for the possible alternatives to membership of the EU:

• For indirect tax, the impact on Customs Duty; Excise Duty; VAT and Capital Duty, as well as which indirect taxes would be unaffected.
• For direct tax, relevant EU law; what would change if the UK left the EU; State Aid rules and Harmful Tax Practices.

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