Two main reasons.
A/ Taxation as a percentage of company profits has been steadily reduced over the last 20 years.
B/ Wealthy companies and super rich individuals with the aid of smart lawyers, have found ways to avoid tax by using tax havens. Companies in the news such as Amazon and Facebook get the headlines but they are not the only ones. That well known British company ‘Boots the Chemists’, when owned by British shareholders paid annual tax of about £100 million. But since bought by a private equity firm, they have paid almost no tax.
According to John Ralfe, Boots’ former head of corporate finance, “the UK has lost about £100m a year in tax as result”.
post by Eric Walker, SCGP Membership Secretary
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