Mr Corbyn indicated plans for the tax rise as he attacked UK companies including Boots over alleged tax avoidance. Boots immediately rejected Mr Corbyn’s accusations.
“They are cutting corporation tax from 20 to 18 per cent, doing very little about companies that offshore their head offices – Boots and others – to Switzerland and other places to pay lower tax,” he said. “Where’s the narrative of this Government in trying to protect corporation tax levels all across Europe.
“We have to start with that. Do we then chase down tax havens and chase down tax evasion? Yes we do. If a company is operating in Britain – as is Boots and many others – making good business, making a lot of money in Britain, they should pay tax on what they earn in Britain. Not by some piece of sophistry move it to Switzerland, Lichtenstein or Luxembourg.”
That’s simply not the way that corporation tax works nor has it ever worked that way. And more importantly, EU rules (which apply to EEA) mean that you can’t make it work that way either.
Not that that is actually the problem with Boots anyway. It’s the effect of a leveraged buyout that lowered their tax bills, not their domicile so much.
Corbyn’s suffering here from the Murphaloon’s ignorance of that wider picture. See! SEE! Tax being avoided, stop it! Without understanding all of the stuff that surrounds the issue.