Monday, February 02, 2009

UK'S media: the investigations begin

On the weekend we promised a major series of articles in The Guardian newspaper and on Britain's BBC Panorama television programme, exposing to a wider public exactly what TJN is concerned about (see what TJN's Richard Murphy has to say about it here.)

The Guardian describes how big a story this is going to be for it: the newspaper

"will expose the extent of tax avoidance by big business, day-by-day over two weeks."

Already, several stories are up on its web site. First, Firms' secret tax avoidance schemes cost UK billions. As the newspaper says:

"An extensive Guardian investigation has examined the accounts of the UK's biggest companies - many of them household names - and discovered a series of sophisticated tax strategies which, critics say, amount to an almost unstoppable tide of perfectly legal corporate tax avoidance.
. . .

UK listed companies are not required to set out exactly how much UK corporation tax they actually hand over to HM Revenue & Customs. When the Guardian asked each FTSE 100 company to provide this information only two offered a response. Similarly each company was asked what its official policy on so-called tax planning is and how this is implemented. No company was prepared to answer the question directly."

The Guardian is also today launching a unique interactive database of the corporation tax figures recorded in the accounts of each FTSE 100 compay in the last four years. It reveals the low amounts of tax paid by some, and a reluctance to supply meaningful numbers to the public.

Other stories include The big question: what is the tax gap? looks at the difference between the £40bn corporation tax collected by HM Revenue & Customs in 2005 and the theoretical tax liability if all taxpayers complied with the letter and the spirit of the law.

The interactive section is here. Another story looking at just how damned difficult it is for anyone - journalists, crime-fighters, whatever - to try and penetrate the offshore world is here.

An overview of the interactive database on companies' taxes is here - and the interactive map itself is here.

See how the drinks giant Diageo has slashed its corporation tax bill here.

And then see the Guardian's editorial

"That old chestnut about tax being one of the only two certainties in this world no longer rings true now that big businesses, the super-rich and an entire industry of consultants - many based in the City of London - devote huge amounts of time and money to paying the taxman as little as possible.

For most people - including politicians and even company directors - modern tax lies somewhere between sorcery and science. . . One result of the absence of debate or scrutiny is that the people with the specialist knowledge - including the large accountancy firms and powerful voices from business - have a disproportionate share of influence on government and legislation. . . . The professional and legal minds involved have done a masterful job in muddying the waters of debate, where they have not chilled or silenced it altogether.

Like the credit boom, the tax-avoidance game represents the triumph of technical proficiency over social responsibility.

More stories about exactly the things TJN is concerned about will roll out over the next two weeks - you can follow it on their website, here. A last word from the editorial:

"Tax lies at the heart of the debate of what constitutes good business in a globalised economy. And, as our series proves, it is not only interesting - it can be rather shocking, too."


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