AAT raises money laundering concerns with new Thames Freeport

Earlier this week the Chancellor confirmed that the Thames area has been chosen as one of eight new Freeports.

The government has said that Freeports will contain areas where businesses will benefit from more generous tax reliefs, customs benefits and wider government support, bringing investment, trade and jobs to regenerate regions across the country that need it most.

AAT (Association of Accounting Technicians), whose members provide tax and accountancy services to around 500,000 small businesses in the UK, have welcomed the idea in principle but expressed concern about the potential for money laundering at such sites if not introduced carefully.

Tax benefits at each of the eight Freeport sites appear generous and include: five years of full relief from Stamp Duty on land and property bought for a qualifying commercial purpose, no business rates for all new, and some existing, businesses until September 2026, no employer National Insurance Contributions for eligible employees from April 2022 until 2026, and possibly until April 2031.

Phil Hall, Head of Public Affairs & Policy, AAT, said;

“Increased investment in the Thames area is clearly welcome and the tax concessions appear quite generous. However, the ‘customs benefits’ referenced in the Budget remain unclear and AAT continues to have concerns about the potential for money laundering. That’s why we have already recommended that the government mirror the example of the Luxembourg Freeport which enjoys many benefits but is simultaneously obliged to meet all of the EU’s anti-money laundering requirements.”