The British government is failing to use its financial might to make companies awarded government contracts pay their fair share of tax, senior MPs have said.
In a series of reports published on Friday, the Commons Public Accounts Committee accused the Cabinet Office and the Treasury of failing to get best value for taxpayers in dealings with firms. The MPs also said the UK government does not use its buying power to challenge firms that had “botched” previous public sector contracts. “A central message emerging from our four reports…is that the Cabinet Office and the Treasury together need to be much stronger if they are to exert effective corporate control over spending in departments and achieve long term sustainable savings for taxpayers,” said Margaret Hodge, the chair of the committee. Last week, British government tax adviser David Heaton stepped down from his post after he was secretly filmed offering tax avoidance tips. Earlier last year, Business giants Starbucks, Google and Amazon were found guilty of dodging millions of pounds in tax in Britain. It is estimated that the corporate tax evasion is costing the UK economy something between 45 to 90 billion pounds a year, meaning that it is practically undoing all austerity measures as well as widening the gap between the rich and the poor in the British society.