read the news // live the culture

UK and Germany propose crackdown for multinational tax avoidance

  Tuesday 6th November 2012

George Osborne has now combined forces with the German finance minister, Wolfgang Schäuble, to declare an international crackdown on tax avoidance by large companies.

Following the meeting of the G20 finance ministers in Mexico, George Osborne had pleaded for “concerted international co-operation to strengthen international tax standards that at the minute may mean international companies can pay less tax than they would otherwise owe”.

hmrcpic

A crackdown on big corporations may result in more money for the country. Photo: Fotolia

While none of the ministers gave any names regarding which corporations they will battle, it was said that globalisation and technological improvements have ensured governments were unable to keep up with the fast-paced, changing nature of business, which has led to many organisations avoiding paying tax.

The two finance ministers have said they will look into which loopholes need urgently closing as a first step in ensuring that profit-shifting is better dealt with on the global level.

After the meeting, Osborne said: “We want competitive taxes that say Britain is open for business and that attract global companies to invest in and bring jobs to our country, but we also want global companies to pay those taxes. The best way to achieve that is through international action that ensures strong standards, without pricing ourselves out of the global market.

The statement, which was written by both the British and German finance ministers, reads that “international tax standards have had difficulty keeping up with changes in global business practices, such as the development of e-commerce in commercial activities”.

The statement follows by saying: “As a result, some multinational businesses are able to shift the taxation of their profits away from the jurisdictions where they are being generated, thus minimising their tax payments compared to smaller, less international companies.”

Due to growing grievances from the general public regarding tax avoidance by big corporations, the government has decided it is finally time to push to resolve this issue.

Alexander Clackson


More about the author


Share this story


  • Pin It
  • Share on Google+
  • Reddit
  • Stumble
  • LinkedIn

Latest related

London Film Festival 2014: Mommy | Review
London Film Festival 2014: Mommy

Thursday 16th October, 6pm – Odeon West EndSunday 19th October, 8.30pm – BFI Southbank Five years ago, [read more]

London Film Festival 2014: Far from Men | Review
London Film Festival 2014: Far from Men

Saturday 18th October, 5.30pm – Vue 5 Sunday 19th October, 3.30pm – Cine Lumiere Cinema Against the backdrop of the [read more]

The Hold Steady and The So So Glos at Koko | Live review
The Hold Steady and The So So Glos at Koko

Koko in Camden has the sort of tacky grandeur that’s perfect for hosting a night of unadulterated rock. Last night [read more]

The Scottsboro Boys at the Garrick | Theatre review
The Scottsboro Boys at the Garrick

In Scottsboro, Alabama, in 1931, nine black boys were tried for the alleged rape of two white girls. They were [read more]

Palace at St Pancras Old Church| Live review
Palace at St Pancras Old Church

An actual working church, St Pancras Old Church is the stunning venue that played host to Palace on Sunday. The lights [read more]

Archives