The Prime Minister said HM Revenue & Customs should “look carefully” at cases where international corporations have legally been able to pay no corporation tax – or very small amounts – on billions of pounds of UK revenue.
Asked by MPs if it was “morally wrong” for big companies like Starbucks and Apple to avoid paying tax, he said he was “not happy” and companies should pay “fair taxes.”
“This is an international problem that all countries are struggling with, about how to make sure that companies pay tax in an appropriate way,” he told the House of Commons. “I am not happy with the current situation. I think the HMRC needs to look at it very carefully. We do need to make sure we are encouraging these businesses to invest in our country, as they are, but they should be paying fair taxes as well.”
Tax on the returns to investment reduce the amount of investment. Thus the more you tax the returns to investment the less investment you\’ll get: making the country poorer in the long term.
There thus isn\’t a possible compromise between tax and investment.