Water services company Severn Trent has announced that it has secured its first Fair Tax Mark certification, making it the third FTSE 100 business to do so.
The company joins a growing movement of businesses that demonstrate they are paying the right amount of corporation tax. The Fair Tax Mark is an independent certification scheme which recognises businesses that do so, and has certified more than 50 businesses, notably including Timpson, Lush, SSE, Richer Sounds and Co-op.
In order to successfully become certified, Severn Trent and other businesses must enhance their tax transparency and disclosures by publishing a separate tax report that plainly sets out what taxes it pays and why. The process of assessment is intended to be initiated by the company that wants the mark.
Growing movement of businesses
Paul Monaghan, Chief Executive, Fair Tax Mark said: “We are delighted to see the third FTSE 100 listed company, Severn Trent, accredit as a Fair Tax Mark business.
“Severn Trent is joining a growing movement of businesses that are proudly saying what tax they pay, committing to transparency in their reporting and being clear to their customers that they won’t be using tax havens or shifting profits to avoid paying what they owe. The public rightly expects responsible behaviour but far too often they’re reading headlines that describe the tactics businesses employ to avoid contributing the tax they owe to the public purse.
“It is estimated that annually, due to corporate profits being shifted to tax havens, corporate tax revenue losses in the UK amount to at least £7bn. Just think of the nurses, doctors and teachers we could employ, or the renewable energy infrastructure we could build if that tax was paid as it should be?”
James Bowling, Chief Financial Officer at Severn Trent, commented: “Receiving the Fair Tax Mark is fantastic news and a major milestone for Severn Trent. It recognises that we’re a company that likes to do the right thing – paying the right amount of corporation tax, in the right place at the right time.
“Most importantly, this accreditation will show our customers that we are a responsible business which takes a great deal of pride in being open and transparent in how we do things.”
Record level of concern
Polling data from Fair Tax Mark showed record levels of concern among the public about the use of tax avoidance practices by UK businesses, and those operating in the UK.
Over three-quarters of respondents said they would rather shop with business (77%), or work with businesses (78%) that can prove it is paying its fair share of tax. Both cases rose by 8% from 2018.
An increasing number also said that it was important to celebrate businesses that can demonstrate good tax conduct and reject the use of tax havens and tax avoidance practices.
Monaghan added: “Paying the right amount of tax is about fairness. The Fair Tax Mark is one way that consumers can easily recognise those who are doing the right thing and show their support through using their goods and services.
“We’re pleased to see that there’s a growing movement of responsible businesses that are stepping up and voluntarily demonstrating a transparent approach to tax. We hope others will follow the leadership of Severn Trent in this area.”