Tax Avoidance - The Knife or The Sledgehammer

The articles in this edition of Tax Insight illustrate different ways in which the tax authorities are seeking to attack what they see as unacceptable tax planning. Examples of the use of the knife are given by the articles concerning the new rules introduced by the Finance Act 1998 concerning private equity transactions and the new construction industry tax scheme, where practices regarded by the Revenue as abuses are being attacked by specific legislative changes. It can be the case, of course, that amendments which are meant to be focused in their effect turn out to have wider implications, and it will be seen from the article concerning private equity that even transactions which do not involve the type of schemes to which the Revenue object must now be documented with increasing care to avoid falling into newly created traps.