Toby Atkin-Wright

There have been news stories over the past weeks about large, usually multinational, companies, and the paltry amounts of corporation tax that they pay in the UK. It strikes me that there are two things at play here.

Firstly, corporation tax is an incentive not to make profits. Corporation tax is payable on trading profits and capital gains, after investments and allowable expenses. So if an organisation wishes to invest in growing its business, it makes sense to incur the costs of doing so rather than to make a taxable profit.

Secondly, with our European single market, it is normal for international companies to have their business based in a country with favourable tax rates, and to declare all of their profits there. Unless tax across Europe is harmonised, there will always be an incentive to base a company in a low-tax country. Indeed, countries compete to be the European base for international companies, and the need to offer more competitive tax rates explains why the corporation tax rates in the UK have been falling in recent years.

Multinationals might be trading — and might be profitable — in the UK, but much of their value can be created overseas, whether through manufacturing or through intellectual property, and it seems right that their costs follow their value.

Mind you, I’m not too worried about whether or not companies pay their corporation tax in the UK — while the revenues are significant, it is nowhere near that raised by income tax, National Insurance, and VAT.

Tax on profit is abstract in a loss-making world. I’m much happier with keeping companies honest with a tax on employement (PAYE) and on trade (VAT).

Chocolate biscuits attract VAT; biscuits without chocolate are zero-rated for VAT. By choosing to buy non-chocolatey biscuits I deny the treasury its 20%: I am engaging in a practice called tax avoidance, the use of legal means to reduce my tax burden.

UK Uncut campaigns against tax avoidance. Am I being morally dubious when I buy a packet of pink wafers, rather than a Kit Kat or a Blue Riband?

Chocolate biscuits attract VAT; biscuits without chocolate are zero-rated for VAT. By choosing to buy non-chocolatey biscuits I deny the treasury its 20%: I am engaging in a practice called tax avoidance, the use of legal means to reduce my tax burden.

UK Uncut campaigns against tax avoidance. Am I being morally dubious when I buy a packet of pink wafers, rather than a Kit Kat or a Blue Riband?

After a morning spent sorting and scanning paperwork in preparation for this quarter’s VAT return, I enjoyed the Grand Prix at Spa. What a pretty circuit, with its hills and forests. And what an exciting race. I think rain should be compulsory for F1 — the races are so much more fun when the weather is unpredictable.

We had a picnic lunch in front of the television, with Belgian wheat beer accompanying our bread and cheese, and Belgian buns to follow. (Not sure that Belgian buns are Belgian in anything but name, but the taste is good!) Some Belgian sea-shell chocolates came later, and Beth ate most of them.

Next up is Monza in a fortnight. We’ll have no problem finding Italian food and drink to go along with the race.

Beth and I had a good swim at the Fairmont before tea. She is getting very confident and independent in the water. My parents will be visiting us next Sunday, so they’ll be able to join us for our weekly swim.

After a morning spent sorting and scanning paperwork in preparation for this quarter’s VAT return, I enjoyed the Grand Prix at Spa. What a pretty circuit, with its hills and forests. And what an exciting race. I think rain should be compulsory for F1 — the races are so much more fun when the weather is unpredictable.

We had a picnic lunch in front of the television, with Belgian wheat beer accompanying our bread and cheese, and Belgian buns to follow. (Not sure that Belgian buns are Belgian in anything but name, but the taste is good!) Some Belgian sea-shell chocolates came later, and Beth ate most of them.

Next up is Monza in a fortnight. We’ll have no problem finding Italian food and drink to go along with the race.

Beth and I had a good swim at the Fairmont before tea. She is getting very confident and independent in the water. My parents will be visiting us next Sunday, so they’ll be able to join us for our weekly swim.