Multinational corporations such as Amazon, Google and Starbucks have been "exploiting" the current UK tax legislation to avoid paying an "appropriate" amount of tax in the country, with HM Revenue and Customs urged to be "more aggressive and assertive" in confronting corporate tax avoidance.
The remarks came in a strongly worded speech by the chair of the Public Accounts Committee Margaret Hodge MP, which accompanied a report released this morning (3rd December) by the PAC examining the HMRC's performance in 2011-12.
She said it was "outrageous" that companies with huge operations in the UK are generating significant income but paying only a little or no corporation tax, and called it an "insult to British businesses and individuals who pay their fair share".
Hodge said HMRC must "act firmly now" in order to make all companies and individuals pay their "fair share" of taxes, and said: "The drive to make these companies live up to their obligations will have to be conducted on a number of fronts. These include possible legislative change within the UK and efforts to increase international cooperation. The multinationals should be required to report their tax practices transparently. Prosecutions should be mounted where necessary and offenders should be publically named and shamed."
Hodge called paying the right amount of tax "a matter of morality", and said HMRC's response so far to multinational's "aggressive tax planning" has so far "lacked determination and looks way too lenient".
The report follows the grilling representatives from Amazon, Google and Starbucks received at a parliamentary session. It comes ahead of chancellor George Osborne's autumn statement, planned for Wednesday this week.