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Source: http://www.accountingtoday.com/news/UK-Parliament-Blasts-Accounting-Firms-Role-Tax-Avoidance-66530-1.html
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The Public Accounts Committee in the British Parliament has issued a critical report blaming large accounting firms, particularly the Big Four, for contributing to tax avoidance.
“Confidence in our tax system can only be maintained if every company and every individual is seen to be paying their fair share of tax,” said Friday’s report from the House of Commons committee. “We held hearings last year to investigate why some multinational companies pay little corporation tax despite doing a large amount of business in the UK, and why some individuals can get away with using contrived schemes to avoid tax. We are also concerned about the role of tax advisors and in January 2013 we took evidence from Deloitte, Ernst and Young, KPMG, and PwC to understand more about the nature of the tax advice they provide.”
The report noted that Her Majesty’s Revenue & Customs department appears to be “fighting a battle it cannot win in tackling tax avoidance.”
“Companies can devote considerable resource to ensure that they minimize their tax liability,” said the committee report. “There is a large market for advising companies on how to take advantage of international tax law, and on the tax implications of different global structures. The four firms employ nearly 9,000 people and earn £2 billion from their tax work in the U.K., and earn around $25 billion from this work globally. HMRC has far fewer resources. In the area of transfer pricing alone there are four times as many staff working for the four firms than for HMRC.”
The report acknowledged that the committee was pleased that the four firms agreed that international tax rules are
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