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Net loophole to slash corporate tax receipts

Register your e-commerce business outside the UK and cut your tax bill, claim consultants

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Corporate tax avoidance is set to increase as more and more companies get hooked online. And as government coffers run empty it will be ordinary consumers who'll have to pick up the tab. That's just one of the conclusions published by an esteemed group of companies and consultants that warns that the Net could provide a legal loophole for companies to avoid paying tax. A report in The Guardian newspaper suggests that major e-commerce companies could simply register themselves in those countries that have more "liberal tax laws" to avoid paying higher taxes, warns Andersen Consulting, Ernst & Young, IBM, KPMG et al. And if governments can't get hold of a company to tax it -- or successfully assess what transactions have happened when -- then their only choice is to hit the consumer instead, the report warns. ®

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