Energy company RWE npower did not pay a single penny of corporation tax in three years despite making profits of £766 million.
Energy company RWE npower did not pay a single penny of corporation tax in three years despite making profits of £766 million.
Grilled by MPs yesterday, npower chief executive Paul Massara claimed there was “nothing amazing” about not paying any corporation tax in 2009, 2010 and 2011.
He added that the company was able to deduct some of the £5 billion it had invested over the period of five years on new power plants against its tax bill.
“It’s a very simply reason why. We have invested £5 billion in the last five years building power plants, creating employment and keeping the lights on. It’s a simple accounting UK rule, there’s no mystery to it. There is no desire not to pay tax. There is nothing amazing about that.”
Yesterday at 10am the Energy and Climate Change Committee questioned energy companies using suggestions submitted via Twitter. The video can be watched in full here.
23 Responses to “Video: Big six energy company paid no corporation tax in three years to 2011”
Nick Reid
Because it made £766m operating profit. You don’t pay tax on operating profit. You may tax on pre-tax profits. Which includes items for depreciation, amortisation and interest payments.
This really is the most basic accountancy.
NuLabour Nemesis
Operating profit, which I think LFF will find generated a rather large amount of VAT.
blarg1987
There is no objection to investment, however if you pay no corporation tax yet have bumper hsare dividens then that is immoral, if however they paid no share dividens and invested then their argument would be fair.