The UK tax opportunity and threat

Proposed changes to the UK's tax regime could persuade investors to flock to capital gains tax structures, but some market participants fear that the Inland Revenue could then re-evaluate the tax status of some structured product wrappers. Offshore fund wrappers such as protected cell companies have already come under scrutiny

If proposed capital gains tax (CGT) changes are passed into law in the UK in April 2008, retail investors could well turn their backs on products that are subject to income tax and instead direct their money towards investments governed by CGT. Structured products issuers have greeted the planned tax changes with a distinct lack of enthusiasm. If investors divert significant funds into CGT