Tax Avoidance (Corporate)

Thank you for contacting me about corporate tax avoidance.
 
I am pleased that the Government is committed to low taxes to support business. However, these taxes must be paid; tax avoidance and aggressive tax planning by multinationals is clearly unacceptable.
 
The Government will continue to address imbalances in the system where some businesses benefit disproportionately from certain rules, and will also continue to tackle avoidance, evasion, non-compliance and tax planning.
 
Significant action has been taken to tackle tax avoidance by multinational companies, especially through working with G20 and OECD partners, to modernise international tax rules. I am pleased that, following developments in these arenas, the Government has set out a comprehensive package to take further action, to modernise the tax rules in the UK, and to ensure that these rules are applied effectively to multinationals.
 
Since 2010, HMRC has secured around £160 billion in additional tax revenue by tackling avoidance, evasion and non-compliance, and the UK's tax gap remains one of the lowest in the world.
 
The Government is committed to tackling tax avoidance and evasion at all levels in order to ensure that everyone pays the right tax at the right time. These practices damage the effectiveness of the tax system and impose additional costs on all taxpayers. Making the tax system fairer means that the Government can afford to fund vital public services and cut taxes for working people. 
 
With regard to developing countries, the key issue is ensuring that these countries have the assistance required to develop their own rules in order to protect their tax bases. The UK has set up a specialist Tax Capacity Building Unit in HMRC, which deploys HMRC staff to developing countries to provide technical expertise. Ministers have committed to doubling funding for tax projects in developing countries by 2020.
 
I have read the articles relating to the 'Fair Tax Town' and I strongly believe that companies both large and small should be treated equally and pay the tax that is due. I believe it is wrong that large multinational companies with activities in the UK enter into contrived arrangements to divert profits from the UK to avoid corporation tax. The Government's new tax on diverted profits will prevent companies from creating tax advantages by using transactions or entities that lack economic substance. I am pleased that the 2016 Budget included measures to stop the complex structures that allow some multinationals to avoid paying any tax anywhere or to deduct the same expenses in more than one country.
 
Thank you again for taking the time to contact me.