Why isn’t BAT paying tax?

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I note BAT now has a new reason for not paying UK tax. Previously it was that it's UK head office made a loss. That's been their story for the last year or so, until a week or two back.

Now I note that they told the Sunday Express that it's because all it's tax is paid abroad and so it doesn't need to pay further tax here. Which one is true? Take your pick.

Either way this means it can only be upset about any proposed changes to UK corporation tax change because it thinks it is likely to pay tax as a result of what is proposed. This says only one thing, which is that it must have passive income in what might be considered a tax haven that might be caught under the new controlled foreign company rules that it does not want to pay tax on.

It's either that or it's making political mischief. Surely not, with former Chancellor Ken Clark on its board? Again, take your pick. Country-by-country reporting would, of course, prove the point, and so be of inestimable worth, yet again.

What I do think is it is making more noise than can be justified. Curiously, so does every journalist I have spoken to.

It's now being said that capitalists are the worst friends of capitalism. Is BAT trying to prove that? Or is it just a case of the company protesting too much?

Disclosure: I am an external research fellow at the Tax Research Institute at the University of Nottingham. Some activities at the University of Nottingham Business School are sponsored by BAT.


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