Capital gains tax, CGT, is a tax on a capital gain arising on the disposal of assets. A 20% rate of CGT applies on the gains arising on the disposal of assets, including land which is the subject of a compulsory purchase order, CPO. This is the lowest rate of CGT in recent history. In budget 1998, the rate was halved from 40% to 20%. Where compensation is received for land that is compulsorily acquired, any gains arising from the amount paid for the acquisition of the land are chargeable to tax. In other words, if there is a sum paid by a public authority for the compulsory acquisition of land, then irrespective of its components, for example, disturbance, injurious affection etc., that total sum will be the amount to be assessed for tax. The CGT due on a disposal of land under a CPO is calculated in the same way as any other disposal of land. The consideration for the disposal will be the sum received for the land. There are no plans to make any changes to the legislation in this regard.