Stephen McPartland is Member of Parliament for Stevenage and has written to the Chief
Executives of all the FTSE 100 companies to ask them individually if they are
willing to pledge their support for corporate tax transparency and if they will
support a new international accountancy standard for country-by-country
reporting. The responses are being published at www.taxchallenge.co.uk so that the
general public know which FTSE 100 companies are willing to sign up to tax
transparency and which are not. Follow Stephen on Twitter.
I took up the initiative after meeting
Christian Aid supporters when the Tax Justice Bus visited Stevenage. The
tax justice campaigners believe that tax dodging by international companies
costs the UK around £35 billion and developing countries an estimated
$160billion per year. Just imagine the dramatic difference such a huge sum of
money would make if it was available to invest in public services,
infrastructure and other vital services essential for economic growth.
I know that Governments from all around the world will agree with the sentiment
of greater tax transparency, but they will struggle to introduce it as every
nation competes in the global race. Despite the best of intentions, I believe
that in the end it will be up to the companies themselves to lead the way and
they will only do that if their customers-the British public-drag them kicking
and screaming towards tax transparency and a fairer tax system for us all.
I set up www.taxchallenge.co.uk to
give everyone an opportunity to sign a petition calling for greater tax
transparency and to publish all the responses I receive so that everyone will
know which FTSE 100 companies are willing to sign up to tax transparency and
which are not.
The responses from the FTSE100 companies have been wide-ranging but generally
disappointing. HSBC has offered to help design a tax transparency standard, BT
and others have welcomed the transparency initiative – although not the new
accounting standard – and Hargreaves Lansdown has questioned the value that it
receives for the taxes that it pays. On a more positive note the Chief
Executive of Sainsbury's agreed that consumers are best placed to encourage
companies to pay the tax they are supposed to, as they can vote with their
wallets if they do not think the company is making a fair contribution to society.
Capita stated they were both interested and supportive of establishing a new
international accounting standard. Morrisions suggested that the Government
should force all companies to disclose their corporation tax payments in the
UK. The refreshingly honest response from Aggreko summed up what many other
companies felt, that they were paying lots of tax and probably more than needed
but felt greater tax transparency was a 'lousy idea'.
I could go on, but the general thrust is pretty simple – the biggest companies
in Britain believe they all honestly pay their taxes and make a huge
contribution to the economy by employing people who have to pay taxes. The
majority of responses so far clearly show that they are not prepared to be
proactive and will only comply with the laws as they stand. Unfortunately,
fancy corporate lawyers can blur the lines between tax avoidance and tax
evasion, but it is clearly wrong, illegal and unfair to the rest of society.
I will keep publishing the responses at www.taxchallenge.co.uk and let the public decide individually whether the biggest companies in Britain
really care about the poorest in our society, at home and abroad. From the
responses I have received so far, I am not convinced they do care.