If you’ve kept up with business news over the last 12 months you’ll have noticed a popular trend; Large businesses finding loopholes in the UK tax system to save themselves from paying vast sums in corporation tax.
We’ve seen it with Starbucks, Google, Amazon and now Vodafone. And these are the companies that have been caught.
The real question is, if they can do it why can’t ‘we’? “We” . . . representing small businesses in the UK.
If every small business made enough profit to fly back and forth from Luxembourg, rent expensive offices and flats in Monaco and hire an army of expensive lawyers in Barbados, then they would probably have enough money to investigate loopholes. In short; an awful lot of money is spent in the first instance before there are any gains in saving or avoiding tax. No wonder it only applies to large companies where these fees represent a drop in the ocean.
We have to accept the reason the likes of Vodafone, who have just raised £84bn from selling off part of their company (and will pay little or no UK corporation tax), get away with it is because they are a global organisation with a turnover of £46bn. To put it in perspective, all the SMEs in the UK had a combined turnover of £1.5bn.
So in reality, it doesn’t work unless you are a multinational. Let us know if you disagree.