A new study has found that HM Revenue & Customs (HMRC) is easing the pressure on a number of high-value businesses, by focusing on full-scale attacks on a select few suspicious firms.
Recent figures have revealed that the number of transfer pricing investigations into large firms has fallen by 15 per cent year-on-year – which many believe is testament to the success of HMRC’s clampdowns.
HMRC has claimed that, by placing a smaller number of large firms under “an exceptional level of scrutiny,” it is winning the war against corporation tax avoidance and evasion through quality, as opposed to quantity.
“We focus our resources on those businesses we think least likely to be playing by the rules, spending much less time with the majority who are open and transparent with us,” said an HMRC spokesperson.
However, with an increasing number of multinational companies effectively ‘named and shamed’ in the press as a result of their transfer pricing activities, experts believe that corporate firms are growing increasingly concerned about their public image – and the impact that negative media attention could have on their reputation and profits.
According to HMRC, transparency is on the rise, and there has been a significant decrease in the number of companies manipulating ‘aggressive methods’ to alleviate their tax liability.
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