The Guardian reports this morning that:
US multinationals underpaid £5.6bn in tax in the UK last year, HM Revenue & Customs believes, according to a national accountancy firm.
The suspected deficit is 14% higher than the figure from the previous year, and would mean US companies now make up nearly half of underpaid tax into British coffers from foreign companies.
A total of £11.5bn in missing tax is suspected by HMRC for 2022-23 from foreign companies – 7% higher than the total in 20201-22, according to the accountants UHY Hacker Young.
What is interesting is that they know what they have not got. That is because providing an absence is always hard.
Except that is not true in this case anymore because data from country-by-country reporting by multinational corporations lets HMRC estimate just what is missing.
And why have HMRC got country-by-country reporting? Because someone thought it up and worked for more than a decade to make it part of the international tax regime since writing the first version in 2003.
There are moments when I like to think I have done something that makes a difference.
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And so you should.
What PSR said
Rana Foroohar writes on this in the FT this morning (not Country by Country reporting but on the topic of multinational company and individual tax avoidance).
The first step to getting “your fair share” is to know what you are missing. Now we need to make sure that the next time HMRC chiefs appear at a Parliamentary committee they are asked “if you know they are underpaying by £XXbn why are you not collecting it?
Agreed
Is this an annual outstanding amount or an accumulated taxes outstanding over a number of years ?
Irrespectively, I assume that the interest is accumulating on these outstanding taxes ?
Also, just like VAT if it’s not paid then their assets should seized until it is
These are estimates per annum
No interest running unless they can prove their point
A massive achievement Richard – enough by itself to make you the go to commentator for BBC economics rather than the inevitable Paul Johnson of IFS.
The BBC is a left leaning news outlet but Richard’s breathless slightly deranged marxist rants hardly promote discussion…
The BBC has been subject to extensive research asn is right leaning – hardfly surprising given its leadership
And as for me as a Marxist – I am a centre left, social democrat, charteed accpuntant who is heavily pro the mixed economy
Politely, you need to do some research
Richard,
Left, Right and centre are on wheels; and they are being shunted around by anyone and everyone to suit their own boring, besotted predilections. Personally, i consider it all quite tedious and irrelevant; ideology is quaintly old-fashioned.
Sadly the response from HMRC is to target people selling on Ebay etc https://www.gosimpletax.com/blog/hmrc-crackdown-to-target-side-hustle-income-earners/
In grotesque malevolent Britain it’s always the small people who get persecuted to make up for the taxes unpaid by the big companies, the latter no doubt making sure it stays that way by endless schmoozing of politicians and tax officials.