Concerns have been raised that although global trading companies are involved in as much as 60% of the global economic activity but pay only 6% of all business taxes. This means that UK resident small businesses suffer the burden of having to pay the majority of tax despite having much lower turnover.
No wonder there is increasing concern and focus on the blatant tax avoidance of these global companies. Recently concerns have intensified leading to the formation of action groups and more attention from the media.
There is a great difference of opinion about the contribution that international business is making to the public finances There are those who argue that international business is undermining the international tax system and paying too little tax; the alternative view is that international business is sticking to the letter of the law and paying the amount of tax that is legally due.
There was a report published at the end of 2012 by the Public Accounts Committee published which covered Amazon, Google and Starbucks and accused these and other global trading companies of abusing the existing rules and not paying the tax that they should.
Investigative journalist and former tax-inspector Richard Brooks has published a book, exposing the shocking ways of how the richest individuals and companies deprive the UK state coffers of billions of tax money. The Great Tax Robbery: How Britain became tax haven for fat cats and big businesses shows how despite making millions in profit, a host of High Street names, including Vodafone, Barclays, Topshop and Boots as well as numerous rich individuals legally pay almost no tax and how HMRC turns a blind eye to billions of illegally unpaid taxes in secret Swiss bank accounts.
If you would like to buy a copy, it is available from our company at a discount to the normal retail price,
In nature, when a foreign body finds a host that provides it with nourishment and it provides it with little or nothing in return we term these parasites. Surely that is exactly what these global trading companies are.
The only way to deal with the global trading companies is to hit them in a way that hurts them and that is financially.
The way in which companies are currently taxed is on profits, since global trading companies are able to manipulate their accounts to reduce their profits in ways that UK small businesses cannot. Then why not introduce a tax on turnover at say 6 %, the payment of which could be reduced or offset by any corporation tax paid.
I understand that in California there is a similar system in operation only they call it a sales tax.
Why not go a step further and make the tax retrospective over the last 5 years. Think of the billions that could be raised, not only to reduce our structural debt but to fund reductions in tax and stimulate growth in our economy.
What do you think ?
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