ARTICLE · 23 JUNE 2023

SSE Generation: When Is A Tunnel A Tunnel?

Norton Rose Fulbright

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The Supreme Court has dismissed HMRC's appeal in respect of the approach to the statutory interpretation of the words ‘tunnel' and ‘aqueduct' in CAA 2001 ss 21–23.

United KingdomTax

Originally published in Tax Journal

The Supreme Court has dismissed HMRC's appeal in respect of the approach to the statutory interpretation of the words 'tunnel' and 'aqueduct' in CAA 2001 ss 21–23. To determine the applicable ordinary meaning of a word, it is right to consider the relevant statutory context. Uncertainty remains, but do not expect legislative reform any time soon.

In HMRC v SSE Generation Ltd [2023] UKSC 17 (reported in Tax Journal, 22 May 2023), the Supreme Court dismissed HMRC's appeal in respect of the availability of capital allowances on expenditure incurred by SSE Generation Ltd (SSE) in connection with the construction of certain 'conduits' used for transporting water. The decision is the latest in a line of cases (Cheshire Cavity Storage 1 Ltd and another v HMRC [2021] UKUT 156 (TCC), Urenco Chemplants Ltd and another v HMRC [2022] UKUT 22 (TCC), and Gunfleet Sands Ltd and others v HMRC [2022] UKFTT 35 (TC)) looking at the tricky issue

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