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Osborne to address ‘unacceptable’ tax paid by multi-nationals

George Osborne 480

Chancellor George Osborne has outlined plans to impose a £2bn a year clampdown on the tax affairs of multi-national firms operating in the UK in an attempt to gain control over the deficit and react to controversy surrounding firms such as Starbucks.

In his Autumn Statement on Wednesday, Osborne will look to address “unacceptable” and “immoral” tax avoidance.

Osborne has handed HMRC an extra £77m a year to tackle companies who avoid tax and “cowboy advisers” who sell schemes designed to facilitate tax avoidance.

This is expected to bring in an additional £2bn per year in tax that would have otherwise gone unpaid.

Osborne says: “The Government is clear that while most taxpayers are doing their bit to help us balance the books, it is unacceptable for a minority to avoid paying their fair share, sometimes by breaking the law.

“We are determined to tackle this problem and HMRC are making good progress, but we are giving them additional tools to bring in more.

“The action we are announcing today will help HMRC close in not only on those who seek to avoid or evade tax, but on the dubious ‘cowboy’ advisers who sell them the schemes and dodges they use to cheat the law-abiding majority.”

The chancellor will announce further action to close specific tax avoidance loopholes on Wednesday.

This follows the publication of a report by MPs on the public accounts committee describing evidence from Starbucks, Amazon and Google, as well as HMRC, as “unconvincing and in some cases evasive”.

The committee added the three companies were “using the letter of tax laws both nationally and internationally to immorally minimise their tax obligations”.

The MPs’ report calls for predictable and fair taxation citing a “complete lack of transparency about why multinationals pay so little corporation tax”.

Committee chair Margaret Hodge says: “There is little credible information about what is going on. The evidence we took from large corporations was unconvincing and, in some cases, evasive. HMRC also lacked clarity when trying to explain its approach to enforcing the corporation tax regime.

“The inescapable conclusion is that multinationals are using structures and exploiting current tax legislation to move offshore profits that are clearly generated from economic activity in the UK.”

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Comments

There are 3 comments at the moment, we would love to hear your opinion too.

  1. Hmm. Unacceptable, Immoral. These words are bandied around by politicians and the media alike as if they are preachers delivering a sermon. Whose morality? Unnacceptable to whom?

    If you don’t like it change the law. The equivalent of the entirety of the UK income tax take is spent on Social security. 40% of which is taken from the so called 1%.

    At some point unproductive costs need to be seen to be cut. Don’t get me started on the EU or the NHS.

  2. “Unacceptable” and immoral tax avoidance”

    Quire so and it is MPs who are among the worst perpetrators. It seems ‘’we are all in it together” – except them. They don’t seem to have the first notion of what ‘leading from the front’ means. No wonder they are keen on hobbling the press.

    That Margaret Hodge not only has the brass neck to add her tuppence worth but is also the Chairwoman when considering her family firm and the tax planning that they (quite rightly) undertake, rally underlines the breathtaking hypocrisy of those in Westminster.

    As others have so rightly pointed out on innumerable occasions, tax avoidance is legal, but by all means hit the evaders as hard as you like. If our prissy and deceitful parliamentarians don’t like avoidance– then change the law – otherwise, please do us all a favour and shut up

    Many of these firms are the wealth creators in the UK, provide employment and in many cases add a little richness to all out lives (so blighted by Westminster). Entrepreneurs by their very nature will seek out arrangements to their advantage and it just reflects the paucity of intellect at Westminster that they cannot understand this.

    This continual harping will have the end result of chasing some of these firms away and discouraging others from setting up in the UK.

    Open for business Mr Cameron? Funny way of going about it.

  3. The invasion of Iraq was probably not just immoral (it destabalised most of the middle east), but also illegal.
    Whilst I don’t like the immoral actions of these companies, as Harry says, CHANGE THE TAX LAW THEN!
    There are plenty of things which are legal (lotteries, gambling and spreadbetting) which i think are immoral and several things which are illegal, which should not be, they should only be viewed as immoral (or different morals to mine).
    When a government starts cofusing immoral and illegal without following the rule of law, we risk and uncertainty and anarchy.

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