The public image of financial services organisations has not yet recovered from the battering it took at the time of the banking crash.
Ongoing scandals relating to product misselling and Libor rate-fixing have seen to that. So many will greet with weary cynicism the Public Accounts Committee's latest report, this time focusing on large accountancy firms, the "unhealthily cosy relationship" they have with government and how this can be exploited to help their clients avoid tax.
The committee is deeply concerned that firms second staff to the Treasury to advise on formulating tax laws, only for those accountants to gain knowledge in the process they can then use back at their firms to help clients make the most of loopholes in the very same legislation.
Labour MP Margaret Hodge, chairwoman of the committee, is understandably exasperated by this poacher-turned-gamekeeper-turned-poacher situation, describing it as "a ridiculous conflict of interest" which ought to be banned.
Few, except perhaps accountancy firms, will disagree. Such an arrangement seems at odds with the Government's attempt to crack down on aggressive tax avoidance.
It is unfair on companies who pay their full dues to the UK taxman that other businesses use elaborate tax avoidance schemes. While such practices may be legal, they are not regarded as fair or ethical by ordinary taxpayers. Public anger last year over Starbucks, Google and Amazon, and their creative approaches to tax, confirmed that.
Accountancy firms insist they are not involved in marketing aggressive tax avoidance schemes any more, but disillusioned members of the public who faithfully pay their taxes and do not engage professionals to "plan their finances" might well be inclined, like Ms Hodge, to cock a sceptical eyebrow.
So it is right the spotlight is now falling on these wealthy auditing firms? They have fared relatively well since the financial crisis, finding their services in demand just as much after the banking crash as before; in staffing terms, they outgun the comparatively smaller and less well-resourced HMRC which is tasked with handling tax avoidance. The simpler tax rules are, the easier it will be for beleaguered Government officials to crack down on aggressive tax avoidance. It will not be so straightforward to prevent companies deliberately locating themselves in low tax jurisdictions. Tackling that problem will require cross-border co-operation to reform international tax laws, but work to that end is underway.
Such reforms will change the landscape accountancy firms operate in, which can only make for a fairer and more transparent tax system.
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules hereComments are closed on this article