The June 2010 Budget confirms that a consultation will be undertaken during 2010 on the tax treatment of employment-related shares and securities offered under "geared growth" and similar arrangements.

A review of these arrangements was initially announced in the March 2010 Budget (see March 2010 Budget: review of tax treatment of growth shares, JSOPs, carried interest and similar arrangements), but the new announcement states clearly that "the aim of the consultation is to . . . ensure that employment income from employment related securities is subject to income tax and National Insurance Contributions".

See page 1, June 2010 Budget - Enforcement and Compliance - Summary of Announcements.

The June 2010 Budget included an immediate rise in the rate of CGT from 18% to 28%, for taxpayers with combined income and taxable gains above the income tax basic rate band, together with an increase in the lifetime allowance for entrepreneurs' relief from £2 million to £5 million. Otherwise, CGT remains substantially unchanged. The increased CGT rate reduces by 10% the differences between the CGT rate and the 40% and 50% rates of income tax. However, the change seems unlikely to reduce the popularity of either tax-favoured share options, or arrangements for employees to secure capital gains tax treatment of the growth in value of interests in shares or other securities, especially when National Insurance contributions liabilities on earnings subject to income tax are taken into account.

Following intense lobbying from employer organisations and the pensions industry, the government has resolved to overhaul the previous government's plans for restricting pensions tax relief for high earners, which were due to be implemented from 6 April 2011 (paragraph 1.118, June 2010 Budget report).

Rejecting the previous government's approach as too complex, the government will investigate whether equivalent revenue (estimated at £3 billion in 2011/12) can be raised through the alternative means of significantly reducing the annual allowance, which is set at £255,000 in 2010/11. Preliminary analysis apparently suggests that an annual allowance in the region of £30,000 to £45,000 may achieve this aim.

As announced in the Coalition Agreement, the government will review the taxation of non-domiciled individuals. The review will consider whether changes can be made to the current rules to bring greater certainty and stability for individuals bringing important skills and investment to the UK.

See paragraph 1.98, June 2010 Budget - Chapter 1 - Budget report.

The June 2010 Budget confirms that a previously-announced change to enterprise management incentives (EMI) legislation will go ahead. The change will enable companies with a permanent establishment in the UK to grant EMI options (currently, only companies which carry out a qualifying trade wholly or mainly in the UK can grant EMI options). The amendment is needed to ensure that the EMI legislation complies with EU state aid rules, and will now be included in a forthcoming Finance Bill to be introduced after Parliament's summer recess in 2010, and will take effect when that Finance Bill receives Royal Assent.

The amendment was orginally announced in the 2009 Pre-Budget Report and included in the March 2010 Budget (see March 2010 Budget: amendments to enterprise management incentives (EMI) legislation), but legislation introducing the measure was postponed until after the 2010 general election.

See June 2010 Budget - BN10 - Enterprise Management Incentives.

The June 2010 Budget confirmed that the coalition government will introduce legislation with effect from April 2011 to tackle "arrangements . . . which seek to avoid, defer or reduce liabilities . . . to income tax and National Insurance Contributions or to avoid restrictions on pensions tax relief". The measure is aimed at arrangements which use employee benefit trusts (EBTs) and similar vehicles. This measure was initially announced in the March 2010 Budget (see March 2010 Budget: tackling tax avoidance using employee benefit trusts), but the June 2010 Budget report confirms that:

See paragraph 2.167, June 2010 Budget - Chapter 2 - Budget report and page 2 of June 2010 Budget - PN3 - Tackling tax avoidance.