Barclays Bank has been forced to admit it paid just £113m in UK corporation tax in 2009 – a year when it rang up a record £11.6bn of profits.
The admission stunned politicians and tax campaigners. It was revealed on the eve of a day of protests planned against the high street banks by activists from UK Uncut, a group set up five months ago to oppose government cuts and corporate tax avoidance.
The Labour MP Chuka Umunna, who lobbied Barclays\’ chief executive, Bob Diamond, to reveal the tax paid by the bank, described the figure – just 1% of its 2009 profits – as \”shocking\”.
The current rate of corporation tax in the UK is 28%, although global banks such as Barclays – which has hundreds of overseas subsidiaries, including many in tax havens – do not generate all of their profits in their domestic market.
Max Lawson, of the Robin Hood Tax Campaign, said: \”This is proof that banks live in a parallel universe to the rest of us, paying billions in bonuses and unhampered by the inconvenience of paying tax.
\”If banks paid their fair share we could avoid the worst of the cuts and help those hit hardest by the financial crisis they did nothing to cause.\”
UK Uncut, which has also campaigned against Vodafone, Boots and Top Shop, intends to take its first national day of action against the banks on Saturday with protesters expected to bring more than 30 high street branches of Barclays to a standstill.
The events and magazines company Top Right Group ran up a corporation tax bill of just £200,000 despite making a pre-tax profit of £186.2m last year.
Top Right, owned by Guardian Media Group and Apax Partners, landed a huge one-off windfall of £166.1m after selling its motoring research arm, CAP. Its chief financial officer, Mandy Gradden, told The Independent the profits on the sale were \”exempt from tax under the substantial shareholding exemption which is available to every company in the UK\”.
And we all remember that the major determinant of Barclay\’s low tax bill was the use of the substantial shareholders exemption, don\’t we?