THE UK NEEDS TO REBUILD public confidence in its tax system, the way it is administered and how companies approach their tax obligations, a report from EY has found.
More than a third of companies have already made or planned to make additional voluntary disclosures, and nearly a quarter are actively considering their approach, the survey of 68 tax directors - 70% of whom come from companies with a turnover in excess of £1bn.
Despite those findings, concerns about the challenges associated with greater tax disclosure still remain. Almost a third of survey respondents said they were concerned about the risk of information being taken out of context and negatively interpreted, while 28% said it would be difficult to provide information in a form that would be easily understood.
EY head of tax John Dixon said: "Public confidence in the UK tax system is at the heart of an effective tax regime but it has been shaken by the recent furore over the taxation of multinational companies. There's now a real need to repair and restore, re-building trust that tax law is fit for purpose, tax authorities have the skills and resources to police them, and that big business is paying the appropriate amount of tax.
"Disclosure has a part to play, removing what can sometimes be perceived by the public as a veil of secrecy around companies' approach to tax and their interactions with HMRC. Many businesses are now starting to seize the initiative by becoming more transparent, but disclosure is complex and filled with difficult choices."
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