Boots in travel tax dispute

Boots the Chemist has been served with an unexpected #500,000 tax bill by the Inland Revenue as a penalty for following government guidelines and luring its employees away from their cars and on to buses.

Following advice from the previous government and now backed by deputy prime minister John Prescott, the company decided to unclog the roads of Nottingham, where Boots has its headquarters, and supply 60 buses a day to ferry 1,300 of its employees to and from work.

Boots said it would contest the tax demand. ‘We are fighting the demand on the basis that we are being unfairly penalised for following government policy on transport.’

But in a written statement the Revenue said: ‘The Revenue has decided to treat the buses as a benefit in kind and is demanding the money from Boots rather than attempting to claim from individual employees.

‘The #500,000 demand is an estimate of the tax due on the benefit for the last six years.’

As increasing numbers of companies are looking at ways to reduce congestion and pollution, the case is being closely watched by other companies and environmental groups.

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