UK 'Google tax' will target inter-company payments

HOT BUTTON TOPIC: Corporate tax avoidance has become a big political issue in Britain in recent years.

LONDON: A new British tax on companies that shift profits out of the country and into tax havens will target inter-company fees for services like use of intellectual property, according to a Treasury document seen by Reuters. 

Companies will also be required to report their potential liability to the new tax, which the note said will sit outside the existing corporate tax system. That is intended to avoid legal challenges under existing tax treaties with countries like Ireland, a major conduit for shifted profits.