Small companies should capitalise on tax dodging

RELATED QUOTES

SymbolPriceChange
MPSLTD.BO363.75+0.80
SBUX70.15-0.64
GOOG536.10-20.44

Independent business in Britain could gain from the unpopular behaviour of larger companies.

Small independent companies may be able to capitalise on the controversy surrounding the corporation tax paid by bigger multi-national groups, analysts told Sky News.

Companies such as Starbucks (NasdaqGS: SBUX - news) and Google (NasdaqGS: GOOG - news) have provoked a furore by revealing the low rates of tax they pay in the UK. Planet Retail research director Matthew Stych told Sky that British retailers could take advantage of the situation by drawing attention to their own tax contributions.

"It's a golden opportunity that comes along once in a decade or so, to really capitalise on the negative publicity that some global retailers are receiving at the moment," Mr Stych said.

"I think it's a huge opportunity that independent retailers in the community must seize now".

MPs (BSE: MPSLTD.BO - news) have criticised the behaviour of foreign-based global companies that have reduced the amount of tax they pay in the UK by moving profits to low-tax jurisdictions.

To help put a stop to so-called "profit shifting", Chancellor George Osborne, Wolfgang Schaeuble, the German finance minister, and Pierre Moscovici, the French finance minister, have promised €150,000 (£120,000) each.

In a letter to the Organisation for Economic Co-operation & Development, which has been examining the problem, they said that it was “important both for its potential impact on Government revenues and for the confidence of our citizens in the fairness of taxation of international companies”.

The ministers want the think-tank to come up with "concrete results” ahead of February's meeting of leading finance ministers.

Seperately, HM Revenue and Customs is preparing to write to 1,200 people who are members of a tax avoidance scheme, to caution them that they will come under closer examination.

"The letters are designed specifically to get those using a marketed avoidance scheme to contact us and settle up," an HMRC spokesman said. "We are acting on behalf of the vast majority of people who don't try to get around the rules. We are cracking down hard on tax dodging."