Global firms tax payments are ‘an insult’

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Global firms in the UK that pay little or no tax are an “insult” to British businesses, a committee of MPs says.

Public Accounts Committee chairwoman Margaret Hodge said HM Revenue and Customs (HMRC) needed to be “more aggressive and assertive in confronting corporate tax avoidance”.

Multinationals such as Starbucks and Amazon have come under fire for paying little or no corporation tax.

They generate UK sales of hundreds of millions of pounds.

Starbucks, for example, sold nearly £400m worth of goods in the UK last year, but paid no corporation tax at all, because it transferred some of the money to a sister company in the Netherlands in the form of royalty payments, bought its coffee beans from Switzerland and paid high interest rates to borrow money from other parts of the business.

HMRC said it already ensured that international companies paid the tax due “in accordance with UK tax law”.

The Treasury said it would provide HMRC with £77m in new money to help it track down wealthy individuals and companies who tried to avoid paying tax.

The Treasury said it expected to recoup £22bn a year as a result of the measures announced.

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