Should The USA Pay £50m VAT On Its New Embassy In London ?

[KKOB]

The American government is fighting the Treasury over a £50million tax demand.

The Treasury is demanding that it pay VAT on the construction of its new £275million embassy, known as The Iceberg.

No-go zone: U.S. refuses to pay £50m VAT tax on new embassy | Mail Online

 

[PASH]

If they take taxes from us for our properties in the US, then they should, if we do not, then no! Simples !!

They do however have a perfectly good embassy in central London in the most expensive part that i assume would be sold, i would make sure they pay a huge capital gains on it!

 

[KKOB]

I think it's probably rented from The Duke of Westminster. His companies own most of the large properties in that area.

Here you go.... Grosvenor Estates, owned by the DoW, already own the freehold and are interested in purchasing the lease.

Grosvenor Estate To Buy US Embassy Lease? | AboutMayfair.co.uk

 

[PASH]

A fair point, i suppose it depends whether they rent it or whether its with a saleable lease? Either way, i am sure the residents around there will be glad to see the back of them as last time i wandered through the square it was a security nightmare. Only the Americans could get away with blocking off streets with concrete blocks and turning a very desirable area into a ghetto

 

[KKOB]

Either way, i am sure the residents around there will be glad to see the back of them as last time i wandered through the square it was a security nightmare. Only the Americans could get away with blocking off streets with concrete blocks and turning a very desirable area into a ghetto

But, I bet they don't get many hoodies or twockers around there at the moment. :wink:

 

[mikehibb]

Living overseas myself I have done work for some Embassies in the past.
All that I can add is that most (not all) countries have reciprocal agreements regarding diplomatic status and buildings ie most countries grant tax excemption to each other. I also believe that this is only whilst the buildings in question are diplomatic premisses, if they sell them on then Tax on profits would be due.

Seems simple to me if UK and USA have reciprocal agreements then no tax should be paid. ( I believe that they do have this agreement)
Where countries do not have this agreement than taxes obviously should be paid.
The FCO repsonse in the article did not admit or deny any agreement, it just said that sometimes FCO do pay tax and sometimes do not for their properties abroad.