UK plans to rival Singapore and woo shipping companies post-Brexit

Laveta Brigham

The UK is drawing up plans to woo shipping companies post-Brexit as it seeks to make London into a rival of Singapore as a hub to register vessels. Plans being submitted to ministers include expanding the scope of the UK’s shipping tax and regulatory regime by counting storage vessels and oil rigs as “ships” for tax purposes to attract more business, […]

The UK is drawing up plans to woo shipping companies post-Brexit as it seeks to make London into a rival of Singapore as a hub to register vessels.

Plans being submitted to ministers include expanding the scope of the UK’s shipping tax and regulatory regime by counting storage vessels and oil rigs as “ships” for tax purposes to attract more business, the Financial Times reported.

Doing so was not permitted under EU rules and could result in more shipping companies registering their vessels under the UK flag. 

Unions and industry bodies have been canvassed about the reform of the industry’s tonnage tax post-Brexit, with the overhaul of the UK’s regime estimated to be worth £3.7bn to the economy over three years.

The plan could create 2,500 high-quality jobs directly, on top of another 25,000 new roles in related companies, according to calculations provided to the Government. 

It comes as trade talks between the UK and EU continue to trundle on, with regulatory divergence remaining one of the key points of disagreement.  

David Blumenthal, a tax partner with Clyde & Co who handles tonnage tax issues, told the FT the Brexit was an opportunity for the shipping industry.

“The idea is that if we’re not constrained by EU state aid, we could have more ability to do things that would make the UK more attractive to shipping companies,” he said.

To give the UK a competitive advantage, plans being mooted include enabling floating production storage and offloading vessels and drilling rigs to be included in the UK tonnage tax regime, according to the FT report. 

The UK’s tonnage tax regime was set up in 2000 by former deputy prime minister John Prescott and includes a requirement for companies to train cadets. The new proposals include a £30m state-funded scheme to train cadets on behalf of companies. 

Source Article

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