Corporate Tax : Where UK Uncut shares common ground with UK entrepreneurs.
They may seem like odd bedfellows but members of UK Uncut whom many would regard as quasi- anarchists appear to have struck at least one chord with highflying members of Britain’s business elite.
This involves the hot topic of multinational behemoths like Vodafone and Google and whether these huge global businesses are contributing their fair share to government revenues in countries where they trade.
UK Uncut campaigns against reductions in public spending arguing that much of the budget deficit could be eliminated if large multinationals paid reasonable rates of corporate tax. Coming from a different direction but arriving in the same place are successful business people who complain that they are playing by the rules and paying sensible amounts of Corporation Tax on their profits while the big corporates can juggle their finances around from one country to the next so that they end up paying virtually nothing.
The problem is that,
at a time of high unemployment, no-one wants to frighten the horses and deter these large entities from having offices and factories in the UK. Nevertheless, it seems reasonable that companies who earn substantial revenues and profits in individual countries should contribute a certain amount to maintaining such things as the roads and health services on which their employees and customers depend.
Google implies UK government is too timid over business tax
This dilemma has been starkly highlighted by Google’s UK arm which has recently confirmed that, in the six years up to 2010, it has paid only £ 8 million in UK Corporation Tax on revenues of over £ 1 Billion. The company’s Executive Chairman, Eric Schmidt, defended the company saying it had a duty to its shareholders to pay the legal minimum while adding that the online search giant, which employs more than 1,000 people in the UK, was committed to having a presence in the UK regardless of the rate of tax.
"We love Britain. If Britain changes its tax laws, we will pay taxes in accordance with those laws. I can't be clearer than that," he said.
This is not the first time that evidence has emerged of a soft touch approach by the Treasury towards those multinationals with taxable profits in the UK and it seems that pressure is now building from all sides to resolve this apparent injustice. However, the government needs to be careful in striking the right balance between receiving reasonable corporate tax revenues and not chasing companies away by being too heavy handed. Throwing the baby out with the bathwater is not going to help anyone. Normal 0 false false false EN-GB X-NONE X-NONE /* Style Definitions */ table.MsoNormalTable {mso-style-name:"Table Normal"; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-priority:99; mso-style-parent:""; mso-padding-alt:0cm 5.4pt 0cm 5.4pt; mso-para-margin-top:0cm; mso-para-margin-right:0cm; mso-para-margin-bottom:10.0pt; mso-para-margin-left:0cm; line-height:115%; mso-pagination:widow-orphan; font-size:11.0pt; font-family:"Calibri","sans-serif"; mso-ascii-font-family:Calibri; mso-ascii-theme-font:minor-latin; mso-hansi-font-family:Calibri; mso-hansi-theme-font:minor-latin; mso-bidi-font-family:"Times New Roman"; mso-bidi-theme-font:minor-bidi; mso-fareast-language:EN-US;}
Britain has always been seen as an attractive place for companies because of its free market policy and reasonable taxation laws, and maintaining this status is vital to Britain’s long term financial stability.
