Osborne to crack down on technology firms tax avoidance
30/09/2014
Chancellor George Osborne has vowed to crackdown on global technology companies who operate in the UK, but do not pay enough tax.
He accused some multinational technology firms of going to “extraordinary lengths” to avoid UK taxes, but claimed things will soon have to change.
Mr Osborne said that these technology companies are “welcome here in Britain with open arms”, but that “we expect those taxes to be paid.”
He continued to say: “We will put a stop to it. Low taxes, but low taxes that are paid.”
It is now expected that the chancellor will announce plans in his Autumn Statement this December, which should stop companies diverting their UK profits to offshore tax havens.
The move could help to raise hundreds of millions of pounds in taxes each year for the British government.
Speaking about the progress of the UK economy whilst he has been the chancellor, Mr Osborne said: "I believe it is perfectly possible for Britain to be the most prosperous major country on earth. The most prosperous, the most dynamic, the most creative."
Smoke and mirrors
Companies that have been accused of avoiding UK tax in the past include Google, who were questioned by the House of Commons Public Accounts Committee (PAC) just last year.
The PAC subsequently called Google a “devious” organisation, which is operating “smoke and mirrors”.
Simon Walker, director general of the Institute of Directors praised Osborne’s choice to target firms who are avoiding tax.
He said: "Tackling the perception that multinationals get a sweeter deal than the vast majority of businesses is the right thing to do, but can only be effective when combined with a radical simplification of the UK's sprawling tax code."
The move also attracted positive comments from John Cridland, director general of the CBI, who said: "Setting low and fair business taxes is the right goal for the UK. The CBI supports transparency on tax and will work with the Government to ensure that tax rules are fair on both sides. Companies will always want to operate within the rules."
Need financial advice?
If you have any personal finance questions related to this news article, then please contact our financial advisers. You can get in touch by asking a question online, calling us on 0800 092 1245, or by arranging a visit.
Share this..
Related stories
Construction sector set to boost UK GDP
It has been revealed today that second quarter growth in the UK construction industry was 8.6% against an initial forecast of 6.6%. This 2% improvement is fairly large although overall it will only revise GDP growth upwards by about 0.1% points. So it looks as if it is safe to assume that UK GDP growth in the second half of 2010 was actually 1.2% against initial indications of around 1.1%. Can we...
Read MoreGeorge Osborne under attack for stating that the pound is under pressure
Shadow chancellor George Osborne is today under attack from Labour for suggesting that Gordon Brown's economic policies have caused the recent run on sterling. The situation bears strange similarities to Alistair Darling's comments about the collapse of the Icelandic economy although the problem is that the run on the pound is actually the fault of the UK government.
Gordon Brown ha...
UK bank shares fall further as currency suffers
Sterling has fallen further in the currency markets after a turbulent morning saw yet more falls in the UK banking sector. The FTSE was down 2% at midday and the vast majority of the fall was purely down to the banking sector. The fall in the currency, the fall in the FTSE and the fall in banking shares is a reflection of the reduced confidence in the UK economy and the UK government.
Read More
Will the next government inherit a poisoned chalice?
This week the problems and concerns regarding the UK economy will be laid bare to the world with confirmation of a record budget deficit, increased national debt and rising unemployment. The opinion polls show the Tory party with a significant lead, after the recent e-mail scandal, but many are now concerned that the next government in office will inherit such a poisoned chalice that they will hav...
Read MoreBritish Airways and Unite in secret talks
The British Airways management and the Unite union are this evening in secret last-ditch talks to try and cut short the ongoing cabin crew strike. The situation has reached critical point with the company stretched to the financial limit and the union seriously concerned about the future of many of their members. While earlier talks were inadvertently disrupted by protesters it seems that both par...
Read More