Margaret Hodge's family company pays just 0.01pc tax on £2.1bn of business

[AtW]

If tax was paid on turnover there would be very few businesses left, because the tax would far exceed profits, resulting in perpetual losses.

"Political pressure to change the way foreign firms are taxed in Britain increased this weekend after the head of the Public Accounts Committee and a former City minister said the option of a “revenue tax” should be seriously considered. "

New push on foreign firms’ tax - Telegraph

If you ask me losses should not be tax deductable - if firm loses money then it's matter for shareholders/directors, if it makes profit it should pay tax on it. Perhaps that would make investors favour actual firms that are profitable.

[fullyautomatix]

I did not miss anything - company with billions turnover should be making sizeable profits (and pay corp tax on those) or go bust. If such company isn't making profits for shareholders then board of directors should be fired.

Yes if it is a publicly listed company and answerable to shareholders. If its majority privately held, it can always pay a third party company based in Cayman Islands for "services"and thus reduce the profit to nothing and pay no tax on profits. But that company based in a tax haven makes a profit and distributes the cash to its "shareholders".

[AtW]

Yes if it is a publicly listed company and answerable to shareholders. If its majority privately held, it can always pay a third party company based in Cayman Islands for "services"and thus reduce the profit to nothing and pay no tax on profits. But that company based in a tax haven makes a profit and distributes the cash to its "shareholders".

Such payments should not be tax deductable, there are already laws regarding transfer pricing since payments are being made to essentially same companies - it's not bona fide arrangement in my view.