Financial News

  • 28 November 2012, 14:28

Morrisons Boss Slams Foreign Rivals Over Tax

Britain's fourth largest supermarket chain has called for the Chancellor to make changes to corporation tax rules to prevent foreign multinationals gaining an unfair competitive advantage.

Morrisons finance director Richard Pennycook told Jeff Randall Live that it is time companies came clean on tax and that tax attached to economic activity in the UK should stay here.

Mr Pennycook told Randall: "We want a level playing field.

"What applies to one company should apply to another. There are big differentials in what companies are paying."

The comments from Morrisons' top finance man come as the furore spreads over tax rates paid by foreign multinationals operating in Britain.

Mr Pennycook told Randall: "The Chancellor must look into this and regulate.

"Taxes on activity here in the UK should stay here. Transparency is very important."

Morrisons has a 12% share of the UK supermarket trade and paid 281m - more than a quarter of its profits - in corporation tax last year.

In contrast discount supermarket chain Lidl - which was founded in Germany - is privately-owned and operates 580 stores and a market share of 2.5%.

Approached by Sky News, Lidl declined to reveal its tax rate but said: "Lidl do not engage in any tax avoidance schemes nor do we have any subsidiaries in 'low tax' countries.

"At Lidl, we believe that every company operating in the UK has a social and economic responsibility to pay corporation tax.

"As a private company, we are under no obligation to release any financial statistics and as routine do not do so, however Lidl UK has paid its fair share of corporation tax in line with UK laws."

Sky News has confirmed that budget chain Aldi, with a 3% market share, paid 12.7m in UK corporation tax last year, on a profit of 70.5m.

Asda, which is owned by the US-based retail giant Walmart, has 17.6% share and paid 163m in tax.

Meanwhile the UK-based leader Tesco, with 31% of the market, paid 694m in tax in 2011.

And Sainsbury's, which maintains 16.4% of the UK market - paid tax of 201m.

Google, Amazon and Starbucks have all been criticised recently for low rates of tax paid in the UK.

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