MPs and Lords called for a crackdown on corporate tax avoidance yesterday in response to an exposé in The Guardian revealing Tesco’s elaborate corporate structure, involving offshore tax havens which enables the retailer to avoid tax payments of what could be up to £1bn of tax on profits from the sale of its UK properties.
MPs have become concerned about offshore centres such as the Cayman Islands which have been making it more difficult for regulatorors such as the Financial Services Authority and the Bank of England to know accurately what is happening in the economy and within businesses.
Labour MP John McFall, the chair of the Treasury select committee, told The Guardian, the committee would also examine the issue of tax avoidance in a report to be published on Monday. The Treasury select committee inquiry was established after the run on the Northern Rock bank at the end of last year.
Lucy Neville-Rolfe, Tesco's executive director of corporate and legal affairs, said in a statement: ‘We have an open relationship with Her Majesty's Revenue and Customs and meet with them regularly to discuss our tax affairs, including our property and international transactions.'
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