Corporation Tax

It is now four years since Private Eye pointed out that the 2010 takeover of Cadbury by US food conglomerate Kraft wiped out the group's tax bill using "weird and wonderful organisations including a Dutch limited partnership...and a US limited liability corporation..." The Sunday Times reports that the group is still not paying a bean in tax.

More than five years after he became chancellor, and long after he called aggressive tax avoidance "morally repugnant", it's pretty embarrassing for George Osborne that a major company operating so profitably should pay no UK tax, HM Revenue & Customs may also expect tough questions on why it appears not to be enforcing laws that it ought at least to limit such avoidance.

If politicians want to plead the immorality of tax avoidance, they must first make the case for the morality of state taxation, for the arbitrary way in which taxes are legislated and implemented and for the concessions that the taxman is allowed to make to some taxpayers. Only then will it be valid to criticise people who arrange their affairs in such a way as to avoid tax.