Tuesday, 29 September 2015

Tax Collection

John McDonnell said during his speech yesterday [Monday 28-Sep-2015] that he will clamp down on large company tax dodgers like Amazon, Google, Starbucks & Vodafone. Vodafone hits back.

The telecoms company said it was “disappointing” the issue of its tax affairs had been raised again. The company has come under fire from campaigners in the past over the amount of corporation tax it pays on UK earnings. It claimed there was “no truth in the allegations in the past and there are none now.  As we have made clear on numerous occasions, Vodafone has always paid its taxes and for the last financial year (2014/15) we paid around £360m in direct taxes in the UK,” a spokesperson said.

In a statement, the company argued investment in a competitive market had left it making “minimal profits” (£41m) in the UK. “As the Government wants to promote investment in essential infrastructure like ours, the UK tax rules mean that relief’s for our investment are set against the profits we make,” the spokesperson said. “In addition the Government understands that we have to borrow huge sums of money to be able to invest for the long term, so they allow us to take the interest we pay on those borrowings off our profit too.

Vodafone paid no UK corporation tax in the year 2012-13, arguing at the time Britain was "one of the least-profitable mobile markets anywhere in the world".

We are in an age of deep public spending cuts and real austerity. And this [tax avoidance] is not a victimless crime, if you like. If this was seven or eight years ago, pre-financial crisis, I do not think it would have had the same impact it has had now.

The four companies mentioned will continue for as long as they can to dodge their responsibilities because they can, I suspect there is no government that can change this, it is up to people to stop using the relevant companies, but how likely is that going to happen when Joe Public says, where do I buy my books from, coffee from, how do I search the net and I’m not giving up my phone, the companies will continue to take the piss.

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