Home Business NewsAlmost all FTSE 100 companies "use tax havens"

Almost all FTSE 100 companies "use tax havens"

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11th Oct 11 3:11 pm

The vast majority of major UK companies listed on the London Stock Exchange use tax havens, research has shown.

ActionAid has called on the Government to take notice of its research, which found 98 of the FTSE 100 businesses have declared tax haven companies. The charity said the Government โ€œcanโ€™t afford to turn a blind eyeโ€.

The companies registered on the London Stock Exchange consist of 34,216 subsidiary businesses, associates and joint ventures, the charity found. Some 8,492, or roughly a quarter, of their overseas businesses are situated in tax havens.

Hargreaves Lansdown and London-headquartered Fresnillo are the only two FTSE 100 companies not to declare tax haven firms. Advertising business WPP is the biggest overall user of tax haven firms, with a total of 611 businesses in these countries, the charity said.

The โ€œbig fourโ€ UK banks – HSBC, Lloyds, RBS and Barclays – made heavy use of tax havens. The banks registered a total of 1,649 tax haven companies, while Barclays has 174 firms registered in the Cayman Islands alone, according to the research.

ActionAid tax justice expert Chris Jordan said: โ€œActionAidโ€™s research showing the use of tax havens by Britainโ€™s biggest companies raises serious questions they need to answer. Tax havens have a damaging impact on the UK exchequer, the stability of the international financial system, and vitally on the ability of developing countries to raise tax revenues which would lift them out of poverty and make them less dependent on aid.โ€

The charityโ€™s research is the first time a full list of FTSE 100 companiesโ€™ subsidiaries has been compiled. The number of companies held in tax havens by major UK-listed companies has resulted in further calls for a crack down on corporate tax avoidance, although there are a number of legitimate reasons for multinational businesses to hold subsidiaries in nations around the globe.

Jordan continued: โ€œWhen multinationals use tax havens to avoid paying their fair share, ordinary people in both poor and rich countries are left to pick up the bill. Spending on doctors, nurses and other essential services gets cut for those who need it most.

โ€œTax havens might provide the lure of financial secrecy and low tax rates for big companies, but at a time when all countries are desperate for revenues, the UK Government canโ€™t afford to turn a blind eye.โ€

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