Corporation Tax Surcharge for late paying PLCs?
A whole host of news stories are appearing in the national press about large companies bullying their suppliers by extending payment terms……in some cases beyond 100 days. According to the Federation of Small Businesses, this ” outrageous” practice is really putting a big cash flow strain on its members, at a time when they can ill afford it. This lack of corporate social conscience amongst our largest organisations has been festering for the last couple of years, but the problem has undoubtedly escalated since the credit crunch began.
One on line reader of the Times yesterday suggested that the Government impose a 2% surcharge on Corporation Tax for large companies whose DPO (Days Purchases Outstanding) registered over 60 days for example.Others are suggesting that BERR inspectors should be employed to do spot checks on large companies’ finance departments, and financial penalties imposed if they find Aged Creditor lists not to their liking. I’m not sure what the answer is, but it’s clear SME’s are getting very agitated, and the government will do well to pay attention to their cries for help.