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28 Aug 2007
The NAO has uncovered the stunning fact that almost a third of the UK's 700 largest companies do not pay a single cent of corporation tax, with a further 30% paying less than £10m each.
The revelations are almost certain to raise the pressure on private equity groups and multinationals, who are able to dramatically cut the tax they owe by claiming interest relief on debt or using intra-group loans.
Other reasons cited for the low tax bills include low profitability, claiming tax losses and pension fund contributions.
The NAO research did acknowledge that the large businesses paid more than half (54%) of the UK's corporation tax takings. According to the NAO large corporations paid £24.4bn in corporation tax in 2005/2006.
Further reading:
Read the NAO report here
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Visitor comments Add your comment
Statistics
One third of group companies does not equate to a third of turnover, or profitability! If there is an influence due to private equity, then I'd be interested to know if the interest-earning companies are paying tax, ie the banks! This sort of piece can form and distort opinion.
Posted by: Neil, 28 Aug 2007 | 00:00
A single cent!
I know this is picky, but I never realised we had the option of which currency to pay our tax in!
Posted by: Jason, 28 Aug 2007 | 00:00
Professionalism
As professionals we should at least ensure that our headlines as well as the stories are balanced.
There is a vast difference between "pays no tax" and "pays no Corporation Tax".
Headline sensationalism should be left to the tabloids and the TV!
Posted by: Richard Mitchell, 29 Aug 2007 | 00:00