Poll: Should big corporations be made to pay more tax in Britain?
Corporate giants must be made to pay more tax in Britain but the companies are not to blame for the "derisory" sums they have paid out, according to Boris Johnson.
Labour counterpart John McDonnell said the public would be "sceptical" about the "relatively small" settlement and called for the National Audit Office to launch an inquiry.In his column for the Daily Telegraph, Mr Johnson said he largely agreed with calls for loopholes and dodges to be axed and said multinationals must hand over more to UK coffers.He wrote: " It has never seemed fair that some of these companies - no matter how wonderful the service they provide - should be paying so much less in tax than the high-street tea rooms and bookshops they have pulverised.
"It would be a good thing, both for the UK finances and for the image of these great companies, if they paid more."
Mr Johnson said the " problem does not lie with the firms", insisting "we should recognise that the fault in the whole affair lies with our national arrangements - our own system for not getting a fair whack from the tech giants".
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He added: " George Osborne has made progress. The Google payback is a start. We now need to go further. We want, need and deserve these companies somehow to pay more tax in the UK."
Google reached the agreement with HM Revenue and Customs over taxes it has owed since 2005 and will also start to pay tax "based on revenue from UK-based advertisers, which reflects the size and scope of our UK business".
It comes after years of criticism of multinational firms over their arrangements in the UK and across Europe.
The internet giant's sales were valued at £3.8 billion in Britain during 2013 but it paid just £20.4 million in UK taxes that year.
Between 2006 and 2011 the company's revenue in the UK hit around £12.6 billion but its corporation tax payments for the period totalled £11.2 million.
Asked whether David Cameron shared Chancellor George Osborne's view that the Google payment was a "victory" for the Government's action on tax avoidance, the Prime Minister's official spokeswoman said: "He sees it as a positive step forward."
The spokeswoman told a regular Westminster media briefing: "It's a step forward, but of course there is more to do. We've always been clear that we want to see low taxes for businesses but that these taxes must be paid.
"What you've got with the Google commitment is: 1. Looking at their actions in the past; and 2. Making a commitment moving forward.
"Clearly there is more for the Government to do to make sure that multinational companies pay their tax. The assessments of this are made by HM Revenue and Customs. It's for them to assess what money is due."
