But the company denied that the use of its Maltese financing subsidiary, Scaris Ltd, was designed to avoid paying tax in Britain and was just a way of borrowing cash to fund British investment \”more efficiently.\”
Paul Massara, chief executive of npower, said: \”The use of Malta in making payments on our financing made no difference to our UK tax contributions. Npower has not, and will not, engage in tax avoidance. Our corporation tax bill was low between 2009 and 2011 because we made losses in our retail business and invested billions into the UK.\”
But Richard Murphy, an accountant who runs a consultancy called Tax Research, said it remained unclear why RWE, npower\’s parent company, would lend money to its UK business via Malta \”unless tax avoidance was its motive. The tax saving that results is very clear.\”
Note the careful clarity of the nPower statement. Whether they borrow the money through Malta, Germany, or indeed from a British bank, makes absolutely no difference to their tax payable in the UK. It\’s therefore very difficult indeed to claim that this is tax avoidance in the UK.
Won\’t stop Ms. Hodge (actually, Lady Hodge, the tax avoider) from climbing aboard her soapbox of course.