New research from the Trades Union Congress (TUC) claims that tax avoidance by companies costs the UK £12 billion a year.
The research was conducted by accountant and tax specialist Richard Murphy of Tax Research UK.
Murphy analysed 344 sets of accounts from Britain's 50 largest companies as well as HMRC and other official statistics.
He found the accounts of the top 50 companies show that their effective corporation tax rate is 22.5%, not the 30% agreed by parliament. Companies also pay 5% less tax on average than they declare in their accounts and in the seven years up to 2006 their effective tax rate fell by 1/2 per cent each year.
The research calls for a stop to HMRC staff cuts so that there are sufficient resources to effectively collect tax and the introduction of a new 'general anti-avoidance principle' to make it easier to tax large companies.
Murphy's research can be found at http://www.tuc.org.uk/index.cfm
