THE CHANCELLOR is set to announce plans to clampdown on tax dodgers amid growing controversy over the tax affairs of multinational companies operating in the UK.
Key to George Osborne's proposals will be an additional £77m a year for HM Revenue & Customs to tackle artificial tax schemes among multinationals, the wealthy and offshore evasion – particularly accelerating work on transfer pricing arrangements, which allow companies to shift profits outside of the UK to lower tax jurisdictions.
He estimates the measure will eventually raise £2bn per year, while a separate deal with Switzerland could bring in more than £5bn of previously uncollected taxes from Swiss bank accounts over the next six years. The total raised by the initiatives would be in the region of £10bn, reports the Financial Times.
The news comes after Starbucks announced it was in talks with the government over its tax affairs. The coffee house has been at the centre of controversy around multinationals' tax affairs after it was revealed it had only posted profits once since it arrived in the UK in 1998, paying £8.6m in corporation tax.
Labour MP Margaret Hodge branded evidence given to the Public Accounts Committee by Starbucks and representatives from Google and Amazon as "unconvincing, and in some cases evasive" in its latest HM Revenue & Customs annual report and accounts.
The report was based on evidence given to the committee by HMRC throughout the year and Amazon, Google and Starbucks. It analysed the department's performance and criticised it for "not taking sufficiently aggressive action to assess and collect the appropriate amount of corporation tax from these multinationals".
Sign up for Financial Director email alerts
Please enter your email below to receive your profile link
Search by job title, salary, or location - we only list senior financial roles
Send to a friend