Rishi Sunak, left, visits the construction site of Teesside Freeport on a visit with local Conservative Party mayor Ben Houchen. AFP
Rishi Sunak, left, visits the construction site of Teesside Freeport on a visit with local Conservative Party mayor Ben Houchen. AFP
Rishi Sunak, left, visits the construction site of Teesside Freeport on a visit with local Conservative Party mayor Ben Houchen. AFP
Rishi Sunak, left, visits the construction site of Teesside Freeport on a visit with local Conservative Party mayor Ben Houchen. AFP

Rishi Sunak accuses Liz Truss of 'copy and pasting' his free port plans


Tim Stickings
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Accusations of "copy and pasting" have emerged in the race to be Britain's next prime minister as Rishi Sunak and Liz Truss both claim credit for championing low-tax free ports.

The idea of business-friendly zones with low taxes and regulation is favoured by many Conservative MPs as a way to boost growth and make the best of Brexit.

Mr Sunak talks up the fact that he announced the creation of the first eight last year, when he was chancellor, and has promised to bring more to Wales and Northern Ireland if he wins the Tory race.

In a recent hustings, he went as far as to say that "I came up with the idea of free ports", which raised eyebrows because the Conservatives called for them as long ago as the 1983 election when Mr Sunak was three years old.

Ms Truss, meanwhile, sought to outflank him by promising new investment zones, or "full-fat free ports" as she calls them. She said these would come with new "model towns" such as the Victorian-era chocolate maker's home of Bournville.

Visiting the Commonwealth Games in Birmingham on Saturday, Ms Truss promised investments in regional transport and heralded her support among prominent Conservatives in areas that might stand to benefit.

"Liz Truss understands that our regions represent a potential gold mine of growth, the West Midlands especially," said Andy Street, the Tory mayor of that region. "Her plan for investment zones, for instance, will give us a powerful tool for unlocking new investment, jobs, and growth."

Liz Truss speaks at a football ground in Solihull, England, at a campaign stop on Saturday. AP
Liz Truss speaks at a football ground in Solihull, England, at a campaign stop on Saturday. AP

The Sunak campaign hit back by saying Ms Truss was borrowing policies already introduced by the government or promised by Mr Sunak if he wins the contest.

"Not only are Team Truss copy and pasting policies put in place by Rishi himself, but they are also re-announcing two-year-old government policies," a spokesman for Mr Sunak said.

"Imitation is the best form of flattery, as the saying goes."

Another piece of evidence called in aid by the Sunak campaign is that their man wrote a paper in 2016 called The Free Ports Opportunity, setting out one of the possible benefits of Brexit.

But this history did not go unchallenged. Daniel Korski, a former Downing Street aide, unearthed a photo showing that both candidates had co-chaired the first meeting of a free port advisory panel in 2019. Ms Truss was trade secretary and Mr Sunak a junior treasury minister at the time.

"[The] truth is they were a great double-act," said Mr Korski, who also ran Tom Tugendhat's leadership campaign earlier in the contest. However, Mr Korski said it was fair to say that Mr Sunak had "reinvigorated discussions" about free ports.

Mr Sunak's team also questioned the comparison to Bournville. They posed the somewhat tongue-in-cheek question of whether this would involve companies owning their workers' homes as the Cadbury company did for its employees.

But a Ms Truss supporter, northern MP Jake Berry, said the foreign secretary was the candidate to deliver on flagship Conservative promises to "level up" Britain's north-south divide.

"Politicians in Westminster have often sung a good song about addressing regional inequality, with varying degrees of success," Mr Berry said. "I firmly believe that Liz’s plan for levelling up will deliver a bright future for the north, and the entire United Kingdom."

Ms Truss opposed Brexit at the time of the referendum in 2016, but now says she has converted to the cause and has promised to slash regulations inherited from the EU.

Both candidates are promising plans for growth as Britain faces increasing economic woes amid runaway inflation and predictions of a looming recession.

The two candidates clashed in Eastbourne, on the south coast of England, on Friday in the fourth out of 12 official hustings before a new Conservative leader is announced on September 5.

That person will replace Boris Johnson as prime minister the following day.

Conservative leadership race - in pictures

  • Candidates Rishi Sunak and Liz Truss at the Conservative Party leadership election hustings at Wembley Arena, London. This was the final hustings attended by Tory Party members who will vote for the new leader and next prime minister. EPA
    Candidates Rishi Sunak and Liz Truss at the Conservative Party leadership election hustings at Wembley Arena, London. This was the final hustings attended by Tory Party members who will vote for the new leader and next prime minister. EPA
  • Liz Truss addresses Conservative Party members at Wembley Arena. AP
    Liz Truss addresses Conservative Party members at Wembley Arena. AP
  • Mr Sunak puts forward his case to be leader while speaking at Wembley Arena. Bloomberg
    Mr Sunak puts forward his case to be leader while speaking at Wembley Arena. Bloomberg
  • Mr Sunak visits his family's old business, Bassett Pharmacy in Southampton, while on the campaign trail. Reuters
    Mr Sunak visits his family's old business, Bassett Pharmacy in Southampton, while on the campaign trail. Reuters
  • Ms Truss speaks to staff at Condimentum Ltd at the Food Enterprise Park in Norwich. Getty Images
    Ms Truss speaks to staff at Condimentum Ltd at the Food Enterprise Park in Norwich. Getty Images
  • A Rishi Sunak supporter at a hustings event in Norfolk. PA
    A Rishi Sunak supporter at a hustings event in Norfolk. PA
  • Mr Sunak greets people at a leadership hustings in Manchester. Bloomberg
    Mr Sunak greets people at a leadership hustings in Manchester. Bloomberg
  • Ms Truss poses for a selfie with a supporter as she arrives for the event in Manchester. Getty
    Ms Truss poses for a selfie with a supporter as she arrives for the event in Manchester. Getty
  • Rishi Sunak looks through the sights of an anti-tank missile launcher, supplied to Ukraine, during a visit to the Thales Defence System plant in Belfast, Northern Ireland. AP
    Rishi Sunak looks through the sights of an anti-tank missile launcher, supplied to Ukraine, during a visit to the Thales Defence System plant in Belfast, Northern Ireland. AP
  • Liz Truss at a Conservative Party leadership campaign event in Belfast. Getty
    Liz Truss at a Conservative Party leadership campaign event in Belfast. Getty
  • Liz Truss meets supporters before a hustings in Perth, Scotland. Getty
    Liz Truss meets supporters before a hustings in Perth, Scotland. Getty
  • Rishi Sunak speaks during a campaign visit to Cluny Castle in Inverurie, Scotland. Getty
    Rishi Sunak speaks during a campaign visit to Cluny Castle in Inverurie, Scotland. Getty
  • Police hold back protesters outside Perth Concert Hall, Scotland, where Conservative leadership candidates Liz Truss and Rishi Sunak were speaking. PA
    Police hold back protesters outside Perth Concert Hall, Scotland, where Conservative leadership candidates Liz Truss and Rishi Sunak were speaking. PA
  • A mural showing the two leadership contestants appears on a wall in Belfast, Northern Ireland. AP
    A mural showing the two leadership contestants appears on a wall in Belfast, Northern Ireland. AP
  • Rishi Sunak during a visit to St John's Wood Synagogue, north London. PA
    Rishi Sunak during a visit to St John's Wood Synagogue, north London. PA
  • Liz Truss at the Conservative Party leadership election hustings in Cheltenham. EPA
    Liz Truss at the Conservative Party leadership election hustings in Cheltenham. EPA
  • Rishi Sunak during a hustings event in Cheltenham. Reuters
    Rishi Sunak during a hustings event in Cheltenham. Reuters
  • Liz Truss speaks to scientists during a campaign visit to a life sciences laboratory at Alderley Park in Manchester. PA
    Liz Truss speaks to scientists during a campaign visit to a life sciences laboratory at Alderley Park in Manchester. PA
  • Rishi Sunak during a campaign hustings in Darlington, England. Bloomberg
    Rishi Sunak during a campaign hustings in Darlington, England. Bloomberg
  • Liz Truss meets party members before she speaks at the Darlington campaign hustings. Getty
    Liz Truss meets party members before she speaks at the Darlington campaign hustings. Getty
  • Rishi Sunak arrives for the Darlington hustings. Getty
    Rishi Sunak arrives for the Darlington hustings. Getty
  • Liz Truss plays pool during a visit to the Onside Future Youth Zone in London. Reuters
    Liz Truss plays pool during a visit to the Onside Future Youth Zone in London. Reuters
  • Rishi Sunak looks at a book with Teddy Openshaw, 4, as his father, Henry, looks on after a Conservative leadership campaign event in Ribble Valley, Lancashire, England. Getty
    Rishi Sunak looks at a book with Teddy Openshaw, 4, as his father, Henry, looks on after a Conservative leadership campaign event in Ribble Valley, Lancashire, England. Getty
  • Liz Truss plays table tennis with former Conservative party leader Iain Duncan Smith during a visit to the Onside Future Youth Zone in London. Reuters
    Liz Truss plays table tennis with former Conservative party leader Iain Duncan Smith during a visit to the Onside Future Youth Zone in London. Reuters
  • Liz Truss with supporters at a campaign event in Solihull, England. Reuters
    Liz Truss with supporters at a campaign event in Solihull, England. Reuters
  • Rishi Sunak attends a campaign event held by his party in Bexhill, England. Reuters
    Rishi Sunak attends a campaign event held by his party in Bexhill, England. Reuters
  • A protester is removed as Ms Truss speaks during the Conservative Party leadership hustings in Eastbourne. Bloomberg
    A protester is removed as Ms Truss speaks during the Conservative Party leadership hustings in Eastbourne. Bloomberg
  • Mr Sunak speaks at an event in Edinburgh. PA
    Mr Sunak speaks at an event in Edinburgh. PA
  • Ms Truss leaves the hall in Exeter, south-west England, after her speech to a Conservative Party membership hustings. Getty
    Ms Truss leaves the hall in Exeter, south-west England, after her speech to a Conservative Party membership hustings. Getty
  • Mr Sunak speaks at the University of Exeter in south-west England. AP
    Mr Sunak speaks at the University of Exeter in south-west England. AP
  • A supporter of Ms Truss at a Conservative Party hustings in Exeter, south-west England. Getty
    A supporter of Ms Truss at a Conservative Party hustings in Exeter, south-west England. Getty
  • Ms Truss at a hustings event at the Pavilion conference centre at Elland Road in Leeds. PA
    Ms Truss at a hustings event at the Pavilion conference centre at Elland Road in Leeds. PA
  • Mr Sunak in Salisbury watching a screening of the Uefa Women's Euro 2022 final between England and Germany at Wembley stadium. England won 2-1 in extra time. PA
    Mr Sunak in Salisbury watching a screening of the Uefa Women's Euro 2022 final between England and Germany at Wembley stadium. England won 2-1 in extra time. PA
  • Ms Truss before the Uefa Women's Euro 2022 final at Wembley stadium in London. AFP
    Ms Truss before the Uefa Women's Euro 2022 final at Wembley stadium in London. AFP
  • Mr Sunak meets Tory members at Fontwell Park Racecourse. Reuters
    Mr Sunak meets Tory members at Fontwell Park Racecourse. Reuters
  • Ms Truss at an event in Dereham, Norfolk. AFP
    Ms Truss at an event in Dereham, Norfolk. AFP
  • Mr Sunak in Ropley, near Winchester, Hampshire. PA
    Mr Sunak in Ropley, near Winchester, Hampshire. PA
  • Ms Truss speaks as Conservative Member of Parliament Tom Tugendhat looks on at a Conservative Party leadership campaign event at Biggin Hill Airport. Getty
    Ms Truss speaks as Conservative Member of Parliament Tom Tugendhat looks on at a Conservative Party leadership campaign event at Biggin Hill Airport. Getty
  • Ms Truss on the campaign trail in Woodford Green, on the outskirts of London. Reuters
    Ms Truss on the campaign trail in Woodford Green, on the outskirts of London. Reuters
  • Mr Sunak at a Conservative Party hustings event in Leeds. AFP
    Mr Sunak at a Conservative Party hustings event in Leeds. AFP
  • Ms Truss speaks at the hustings event in Leeds. AFP
    Ms Truss speaks at the hustings event in Leeds. AFP
  • Sunak and Truss-themed souvenirs at a stand during the Leeds hustings event. Reuters
    Sunak and Truss-themed souvenirs at a stand during the Leeds hustings event. Reuters
  • Ms Truss, and her mother, Patricia, arrive for the hustings event. Getty
    Ms Truss, and her mother, Patricia, arrive for the hustings event. Getty
  • Ms Truss poses with supporters in Morley, England. Getty
    Ms Truss poses with supporters in Morley, England. Getty
  • Mr Sunak delivers a speech during a campaign event in Newmarket. AFP
    Mr Sunak delivers a speech during a campaign event in Newmarket. AFP
  • Ms Truss and Jake Berry, MP for Rossendale and Darwen, during a visit to a broadband interchange company in Leeds. PA
    Ms Truss and Jake Berry, MP for Rossendale and Darwen, during a visit to a broadband interchange company in Leeds. PA
  • Mr Sunak answers questions as he takes part in the hustings in Leeds. AFP
    Mr Sunak answers questions as he takes part in the hustings in Leeds. AFP
  • Ms Truss speaks at an event at a private house with members of the Conservative Party in Woodford Green. PA
    Ms Truss speaks at an event at a private house with members of the Conservative Party in Woodford Green. PA
  • Ms Truss and Mr Sunak pose for a picture before a BBC leadership debate at Victoria Hall in Hanley. Getty
    Ms Truss and Mr Sunak pose for a picture before a BBC leadership debate at Victoria Hall in Hanley. Getty
  • Ms Truss addresses Mr Sunak during the televised debate. Getty
    Ms Truss addresses Mr Sunak during the televised debate. Getty
  • Mr Sunak, with daughters Krishna and Anushka, and wife Akshata Murthy, during a visit to Vaculug tyre specialists at Gonerby Hill Foot, Grantham. PA
    Mr Sunak, with daughters Krishna and Anushka, and wife Akshata Murthy, during a visit to Vaculug tyre specialists at Gonerby Hill Foot, Grantham. PA
  • Ms Truss speaks to people while campaigning in Marden. Getty
    Ms Truss speaks to people while campaigning in Marden. Getty
  • Ms Truss celebrates after being named, along with Mr Sunak, one of the final two candidates in the race to become the UK's next prime minister. PA
    Ms Truss celebrates after being named, along with Mr Sunak, one of the final two candidates in the race to become the UK's next prime minister. PA
  • Mr Sunak outside his campaign office in central London. EPA
    Mr Sunak outside his campaign office in central London. EPA
  • Ms Truss outside Downing Street in London. Reuters
    Ms Truss outside Downing Street in London. Reuters
  • Rishi Sunak meets Conservative Party members and activists, in Teesport, Redcar. Reuters
    Rishi Sunak meets Conservative Party members and activists, in Teesport, Redcar. Reuters
  • Conservative leadership candidates Mr Sunak, Ms Truss, Kemi Badenoch, presenter Julie Etchingham, Tom Tugendhat and Penny Mordaunt during 'Britain's Next Prime Minister: The ITV Debate' in London. EPA
    Conservative leadership candidates Mr Sunak, Ms Truss, Kemi Badenoch, presenter Julie Etchingham, Tom Tugendhat and Penny Mordaunt during 'Britain's Next Prime Minister: The ITV Debate' in London. EPA
  • Ms Badenoch arrives at Here East studios in Stratford, east London, before a live television debate. PA
    Ms Badenoch arrives at Here East studios in Stratford, east London, before a live television debate. PA
  • Mr Sunak arrives at a London event to launch his campaign to be the next Conservative Party leader and UK prime minister. Reuters
    Mr Sunak arrives at a London event to launch his campaign to be the next Conservative Party leader and UK prime minister. Reuters
  • Mr Tugendhat appears on the BBC One current affairs programme, 'Sunday Morning'. PA
    Mr Tugendhat appears on the BBC One current affairs programme, 'Sunday Morning'. PA
  • Ms Badenoch, Ms Mordaunt, Mr Sunak, Ms Truss and Mr Tugendhat before the live television debate. PA
    Ms Badenoch, Ms Mordaunt, Mr Sunak, Ms Truss and Mr Tugendhat before the live television debate. PA
  • Ms Mordaunt arrives for the launch of her Conservative leadership campaign at the Cinnamon Club in Westminster. PA
    Ms Mordaunt arrives for the launch of her Conservative leadership campaign at the Cinnamon Club in Westminster. PA
  • Ms Truss speaks at the launch event for her campaign to become the next leader of the Tory Party and Britain's prime minister, in London. EPA
    Ms Truss speaks at the launch event for her campaign to become the next leader of the Tory Party and Britain's prime minister, in London. EPA
  • Chancellor of the Exchequer Nadhim Zahawi, one of the candidates who has been knocked out of the race, giving a speech at the Churchill War Rooms. PA
    Chancellor of the Exchequer Nadhim Zahawi, one of the candidates who has been knocked out of the race, giving a speech at the Churchill War Rooms. PA
  • Former leadership candidate Jeremy Hunt appearing on the BBC One current affairs programme, 'Sunday Morning'. PA
    Former leadership candidate Jeremy Hunt appearing on the BBC One current affairs programme, 'Sunday Morning'. PA
  • Sajid Javid attending the launch of his campaign to be Conservative Party leader and prime minister, at the Cinnamon Club in London. He has since been knocked out of the contest. PA
    Sajid Javid attending the launch of his campaign to be Conservative Party leader and prime minister, at the Cinnamon Club in London. He has since been knocked out of the contest. PA
  • Rehman Chishti is interviewed after announcing his bid to become the next prime minister. Mr Chishti is no longer in the race. Getty
    Rehman Chishti is interviewed after announcing his bid to become the next prime minister. Mr Chishti is no longer in the race. Getty
  • Mr Tugendhat speaking at the launch of his campaign. PA
    Mr Tugendhat speaking at the launch of his campaign. PA
  • Culture Secretary Nadine Dorries and Conservative MP Iain Duncan Smith arrive for the Truss campaign launch event. Getty
    Culture Secretary Nadine Dorries and Conservative MP Iain Duncan Smith arrive for the Truss campaign launch event. Getty
  • Former leadership candidate Attorney General Suella Braverman at the Churchill War Rooms in central London. PA
    Former leadership candidate Attorney General Suella Braverman at the Churchill War Rooms in central London. PA
  • Supporters of Mr Sunak wait for his arrival ahead of the campaign launch. Bloomberg
    Supporters of Mr Sunak wait for his arrival ahead of the campaign launch. Bloomberg
  • Mr Tugendhat makes a speech at the launch of his campaign. PA
    Mr Tugendhat makes a speech at the launch of his campaign. PA
  • Mr Javid mops his brow while launching his campaign. Getty
    Mr Javid mops his brow while launching his campaign. Getty
  • Ms Truss leaves for work after her announcement that she would be running for the leadership of the Conservative Party. Getty
    Ms Truss leaves for work after her announcement that she would be running for the leadership of the Conservative Party. Getty
Key developments

All times UTC 4

Ten tax points to be aware of in 2026

1. Domestic VAT refund amendments: request your refund within five years

If a business does not apply for the refund on time, they lose their credit.

2. E-invoicing in the UAE

Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption. 

3. More tax audits

Tax authorities are increasingly using data already available across multiple filings to identify audit risks. 

4. More beneficial VAT and excise tax penalty regime

Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.

5. Greater emphasis on statutory audit

There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.

6. Further transfer pricing enforcement

Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes. 

7. Limited time periods for audits

Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion. 

8. Pillar 2 implementation 

Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.

9. Reduced compliance obligations for imported goods and services

Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations. 

10. Substance and CbC reporting focus

Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity. 

Contributed by Thomas Vanhee and Hend Rashwan, Aurifer

 

 

Updated: August 07, 2022, 10:53 PM