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International effort urgently needed to tackle companies not paying their way

Richard Mowbray is correct: no corporation or individual is obliged to pay a penny more in tax than the law provides (Letters, November 16).

However, I disagree with him that the individual who, for example, buys an ISA to lower his or her tax burden is in the same position morally as a global corporation which takes aggressive action to ensure it pays no tax at all.

As individuals, we can take certain steps at the margin to reduce our tax burden, but however adept we are, the vast majority of us have no option but to pay a large slice of our income in tax. We are not able to declare ourselves citizens of Luxembourg, domicile ourselves or our spouses in Monaco, or morph ourselves into a service company for tax purposes. Nor, for the most part, do we wish to.

We accept as a matter of fairness and practicality that if we wish to enjoy good public services and provide a decent system of benefits, we have to pay for them. It may well be that current tax rates are too high, as Mr Mowbray suggests, but that is a separate issue from whether we should pay anything at all.

I believe in capitalism as a force for good, and a low-tax economy which encourages enterprise. But reciprocity is the oil which lubricates society. When Amazon, Starbucks, Google and many more wave two fingers at the markets that nourish them, by extracting eye-watering sums and making no contribution in return, they corrode not just their own reputations, but society in general.

It is that these companies provide substantial numbers of jobs, which are indeed a benefit, albeit that many of them are low-paid, temporary, or part-time. But how great a benefit are they when, as Andy Street, the chief executive of John Lewis pointed out last week, the fancy financial footwork of multinationals threatens the long-term viability of UK companies which provide the tax base on which our economy depends?

Governments internationally need to tackle this issue urgently and in concert. Arguments which attempt to justify the current position are like the standard Starbucks cappuccino – mostly froth.

Stephen Gold,

Burnside Road, Glasgow.

Contextual targeting label: 
Business

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