"There is room for confusion and misinterpretation over a company's tax bill, particularly if you just look at the corporation tax. Businesses face a huge array of taxes over and above the tax on their profits. Their contribution to the economy in taxes paid needs to be better understood."
John Whiting, tax partner, PricewaterhouseCoopers
June 2007
It's now more important than ever for your company to understand its total tax contribution to the economy and society.
The amount of tax paid by large businesses is coming under increasing scrutiny and yet they pay considerably more in tax than it might first appear. There is also a need for greater understanding of a company's overall contribution in taxes - not only among the public, but also politicians, investors, employees and other stakeholders.
A business' tax contribution and its tax strategy should be looked at from the point of view of all the taxes it bears and collects – its total tax contribution.
Research conducted by PwC for The Hundred Group shows that the total amount of tax borne by the UK's largest companies is double that of corporation tax when the many other business taxes are added. And for every £1 paid in corporation tax companies collect a further £3.70 in taxes collected.
In an increasingly global business environment, companies often have the choice as to the countries in which they will carry out their activities - tax cost is often an important component of that decision. Without a true understanding of total tax costs they cannot make fully informed business decisions, consider their approach to tax and how they manage tax risk.
