What super fun!

Richard Murphy has spent some years telling us that the correct measure of the tax rate faced by a company is cash tax paid in that year. All insistences that this might not be quite true have been angrily shouted down:

The Tesco plc case shows that. In 2021 its income statement suggests that it has a current tax liability for that year of £178 million. Adjustments elsewhere in the accounts changed that into a refund of £10 million. Which figure is right in that case? And what is the appropriate tax rate to suggest that the company was paying in proportion to profit? Was it the 21.6% that the income statement suggested, or was it the negative 1.2% that the overall refund suggested? Just to confuse matters, the company paid £255 million in the year: that provides no reliable alternative in that case.

From Richard Murphy’s latest “research”.

Oh.

5 thoughts on “What super fun!”

  1. I am pretty surprised given the identity of the people behind the ‘Corporate Accountability Network’ (just how many of these sock puppet organizations has this guy set up FFS?)that Tesco has agreed to provide the information, and am pleased a number of organizations haven’t. Who does this grifter represent? His claim to be a ‘voice’ for civil society sound pretty hollow to anyone. Certainly, one hopes when ‘tax justice’ (whatever that means) campaigners come calling, the usual response is ‘f%^& you’ forcefully enunciated….

  2. “Tesco has agreed to provide the information”

    Murphy – if you do not provide the information I request, I will conclude that you are an evil tax dodging company.

    Tesco – here you are then.

    Murphy – Having reviewed the information I requested I have concluded that you are an evil tax dodging company.

  3. Why would Herr Oberst Professor Kartoffel need to ask Tesco for their accounts? The annual report is freely available online.

  4. Dennis, CPA to the Gods

    The financial information made available to Murph was prepared using IFRS, so it doesn’t really matter what Tesco did or didn’t give him. IFRS doesn’t produce tax expense, or any tax-related assets or liabilities, that will match tax expense, or any tax-related assets or liabilities, that are calculated on a tax basis. Why? IFRS basis and tax basis are two different systems that really don’t have much to do with each other… Mainly because they are two different systems trying to do two different things.

    Murph just can’t seem to wrap his head around the idea that he’s attempting to hammer a round peg into a square hole.

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