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Multinational tax dodging strategies should be as damaging as fuelling climate change

3 6 0
11.06.2021

The G7’s landmark deal to tackle tax avoidance and crack down on multinational companies that treat our global economy as a financial rabbit warren, might seem a welcome step in the right direction. But until businesses start seeing tax as an investment opportunity as opposed to an unwelcome bill, it’s unlikely to make much of a difference.

Clever accounting is not illegal and the world’s network of tax havens, transfer pricing schemes and equity swaps is not going to evaporate overnight.

Businesses operating in the UK benefit from a system that enables them to be profitable here, so paying a fair share of tax is not just about taking a moral stance and “doing the right thing”; it’s about investing in the future of the market. Siphoning off profits and transferring them to low-tax jurisdictions contributes to the erosion of public services, which over time is corporate self-sabotage.

At the end of last year more than 1,000 corporations with a turnover of £45m or more applied for the government’s........

© City A.M.


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