“It is in no way tax avoidance" - quote of the day

Npower has admitted to paying zero corporation tax between 2009 and 2011.

One of Britain’s big six energy companies, Npower, has admitted to paying zero corporation tax between 2009 and 2011, as it pumped billions in to keeping “the UK's lights on"

Speaking at the energy and climate change select committee yesterday, Npower chief executive Paul Massara defended the energy giant’s tax practices, saying “it is in no way tax avoidance, and all of our business is taxable in the UK".

"Effectively we have invested £5bn in the last five years building power plants, creating jobs, creating employment and helping to keep the lights on.

"If we had not made that investment, we would not have the deductibility that we would be allowed. That is a simple accounting UK rule,” Massara told the MPs.

Npower reported a 34 per cent rise in profits to £413m last year.

The energy companies were called before the MPs in the light of worsening public trust in them, as their profits rise but household bills rocket.

Labour MP Ian Lavery said, "In the last three years, [Npower] has reported profits totalling £766m – yet today they admitted they have not paid a single penny of corporation tax over that period. 

"People who pay their taxes unquestioningly are sick and tired of seeing hugely profitable companies use every trick in the book to get out of contributing their fair share."

Another Labour MP, John Robertson, urged consumers to switch energy providers in protest, dubbing Npower “the new Starbucks”.

However, Andrew Watters, a partner in Thomas Eggar LLP, condemned this "current name and shame approach".

"It seems to be a modern version of the ducking chair where the accused is ducked until they accept guilt, or drowns (a sure sign of guilt). Some people see the new General Anti Avoidance Rule (GAAR) as the way to clarify how morality and law interact. Let us hope the GAAR Advisory Committee has at least one member called Solomon."

This story first appeared on economia

Photograph: Getty Images
David Cameron addresses pupils at an assembly during a visit to Corby Technical School on September 2, 2015. Photograph: Getty Images.
Show Hide image

Can Cameron maintain his refugee stance as he comes under attack from all sides?

Tory MPs, the Sun, Labour and a growing section of the public are calling on the PM to end his refusal to take "more and more". 

The disparity between the traumatic images of drowned Syrian children and David Cameron's compassionless response ("I don't think there is an answer that can be achieved simply by taking more and more refugees") has triggered a political backlash. A petition calling for greater action (the UK has to date accepted around 5,000) has passed the 100,000 threshold required for the government to consider a debate after tens of thousands signed this morning. Scottish Conservative leader Ruth Davidson has tweeted: "This is not an immigration issue, it's a humanitarian one, and the human response must be to help. If we don't, what does that make us?" Tory MPs such as Nicola Blackwood, David Burrowes, Jeremy Lefroy and Johnny Mercer have similarly appealed to Cameron to reverse his stance.

Today's Sun declares that the UK has "a proud record of taking in desperate people and we should not flinch from it now if it is beyond doubt that they have fled for their lives." Meanwhile, the Washington Post has published a derisive piece headlined "Britain takes in so few refugees from Syria they would fit on a subway train". Labour has called on Cameron to convene a meeting of Cobra to discuss the crisis and to request an emergency EU summit. Yvette Cooper, who led the way with a speech on Monday outlining how the UK could accept 10,000 refugees, is organising a meeting of councils, charities and faith groups to discuss Britain's response. Public opinion, which can turn remarkably quickly in response to harrowing images, is likely to have grown more sympathetic to the Syrians' plight. Indeed, a survey in March found that those who supported accepting refugees fleeing persecution outnumbered opponents by 47-24 per cent. 

The political question is whether this cumulative pressure will force Cameron to change his stance. He may not agree to match Cooper's demand of 10,000 (though Germany is poised to accept 800,000) but an increasing number at Westminster believe that he cannot remain impassive. Surely Cameron, who will not stand for election again, will not want this stain on his premiership? The UK's obstinacy is further antagonising Angela Merkel on whom his hopes of a successful EU renegotiation rest. If nothing else, Cameron should remember one of the laws of politics: the earlier a climbdown, the less painful it is. 

George Eaton is political editor of the New Statesman.