Shorn of its European Union legal constraints the business regulatory environment of the United Kingdom under Boris Johnson continues to rove in new directions.
The latest state vehicle to get tax perks from the nation’s finance minister is the shipping register. In decline for a decade, the UK flag is set for a financial overhaul.
The government yesterday announced that from April next year far more international shipping companies will be able to apply for the UK’s tonnage tax system in changes that will be announced as part of this week’s budget which will affect all Red Ensign flags including the likes of the Isle of the Man and Gibraltar.
“Whilst the UK was part of the EU, many companies who were part of, and therefore benefitting from, our [tonnage tax] regime, had to abide by rules which meant there was no recognition of the difference between a ship flying the Union Jack and other flags from EU countries. Now the UK is an independent free-trading nation, this rule no longer applies,” the government explained in a release issued on Sunday.
Rishi Sunak, the UK’s finance minister, said: “The UK has always been a proud and pre-eminent maritime nation, with 95% of our trade in goods carried out by sea. Now we have left the EU, it’s time for us to do even more to help the UK shipping industry to grow and compete in the global market.”
Specifics of the flag revamp will be revealed on Wednesday and cannot come soon enough for the the embattled UK Ship Register, which two years ago dropped out of the world’s top 20 list of flag states by size for the first time since records began.
British government studies, revealed last year, in how to overhaul the flag post-Brexit made no secret of looking to Singapore for inspiration.