In evidence to the House of Lords Select Committee on Economic Affairs, ACCA pointed out that HM Revenue and Customs was working with businesses in a 'quick and effective manner' to ensure taxes were collected.
Chas Roy-Chowdhury, ACCA head of taxation, said: 'We need to look at the bigger picture when it comes to how corporations are taxed in the UK. There are alternative ways by which companies in the UK are taxed, for example through VAT.'
Speaking after giving evidence to the House of Lords, Chas Roy-Chowdhury said that the fundamental problem is that large companies are by nature multinational – their shareholders, activities and customers are spread across the world – whilst national governments are not.
Chas Roy-Chowdhury added: 'There is a tax chasm between what governments seek to capture by way of corporation tax and what companies, many of which are global in terms of their shareholders, activities and customers, generate in terms of global profits. In practice, existing rules are highly complex and differences between countries can be exploited well within the law. HMRC has adapted to this and is not sitting on its laurels as some other Parliamentary committees have suggested. They are quick and effective and have developed a greater understanding of how companies work. The majority of corporations go through the tax process with ease. HMRC has achieved this despite declining resources.'
Name and shame
House of Lords Select Committee on Economic Affairs raised the issue of naming and shaming those who have promoted failed tax avoidance scheme. Chas Roy-Chowdhury said: 'If naming and shaming is going to be introduced, the bar needs to be set very high. The complexity of the tax system means there is a risk that mis-interpretation could result in naming and shaming of an adviser, which is a severe punishment.
'We have long been calling for greater regulation of tax advice. While ACCA and other accountancy bodies have strict regulation and standards, anyone can set up and offer tax advice without those safeguards in place.'
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For more information, please contact:
Steve Rudaini, ACCA Newsroom
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Helen Thompson, ACCA Newsroom
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Notes to Editors
- ACCA (the Association of Chartered Certified Accountants) is the global body for professional accountants. We aim to offer business-relevant, first-choice qualifications to people of application, ability and ambition around the world who seek a rewarding career in accountancy, finance and management.
- We support our 154,000 members and 432,000 students in 170 countries, helping them to develop successful careers in accounting and business, with the skills required by employers. We work through a network of over 80 offices and centres and more than 8,400 Approved Employers worldwide, who provide high standards of employee learning and development. Through our public interest remit, we promote appropriate regulation of accounting and conduct relevant research to ensure accountancy continues to grow in reputation and influence.
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