THE CORPORATE TAX RATE should be dropped to 10%, with much of the tax code re-written in order to compel foreign businesses to contribute the same amount as UK companies, according to the Free Enterprise Group of Conservative MPs.
In a report published today, the influential group of 40 senior Conservatives headed by Charlie Elphicke calls for a simpler tax system which would have a chilling effect on "foreign-based multinationals" which "avoid UK taxes on an industrial scale".
Slashing the corporate tax rate to 10% would increase the UK's competitiveness, and would be paid for through abolishing tax reliefs and "international avoidance structuring".
Such a system would be "internet-ready" and would "make tax avoidance as difficult and unattractive as possible".
"Such a change would be radical yet it would make the UK one of the lowest tax jurisdictions in the World with a loophole free system fit for the internet age," the report adds.
Several well-known multinationals including Google, Starbucks and Amazon have been heavily criticised for their tax affairs, with the Public Accounts Committee describing their practices as "immoral", and in particular branding Google "evil" only last week.
Avoidance of this kind "is damaging to the overwhelming majority of UK-based businesses that cannot avoid taxes in the way foreign based enterprises are able to", the group said, adding that with one of the most complex tax codes in the world, enacting its suggested changes would see all businesses "treated the same".
"Tax avoidance would still be possible, yet it would be more limited than at present", the group said.
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