Will government crackdown on supplier tax regimes reveal the true baddies or reveal its own fallibilities?

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The government is set to introduce new rules to help it better understand the kind of tricks its suppliers are using to reduce their tax bills. It seems that the Cabinet Office will announce some new rules this week which might mean suppliers have to reveal all to them.

But what will this achieve. Surely they will have to change the taxation rules if they are to get the suppliers to pay more tax. I say this because unless the suppliers are breaking the law the only thing they can do is change the law.

For example Accenture says the reason it has not paid much tax in recent years is because it has not made much UK profit as a result of losses associated with its failed NHS patient records deal.

I am sure most suppliers have genuine reasons, that fall within the rules, for not paying much tax. Perhaps it might reveal who the baddies are. Maybe some are flouting the law completely while others are pushing the boundaries with the offshoring of profits.

But could it just be that the UK tax system is full of holes and needs to be re-vamped?
If the government changes the way it taxes companies I am sure it will face huge pressure from business.

So this could just be a publicity stunt that ends up achieving nothing.

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This page contains a single entry by Karl Flinders published on February 12, 2013 12:35 PM.

Fear and loathing in Barnet - why public sector outsourcers, their shareholders and the coalition government need to be afraid, very afraid was the previous entry in this blog.

Report on Central and Eastern European nearshoring is the next entry in this blog.

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