The Guardian newspaper has been successful in admitting additional evidence of further tax avoidance schemes into its libel defence against retailer Tesco. The case was brought over allegations by the newpaper that Tesco had been avoiding over £1bn in UK corporation taxes.

In a preliminary hearing at the High Court yesterday, Mr Justice Eady ruled that the paper could file evidence of Tesco's tax avoidance by the use of specially created partnerships and companies in Switzerland and Luxembourg. These schemes were by Private Eye two months ago following the Guardian's original allegations against Tesco. Both schemes have netted the retailer millions of tax savings in UK profits, although one has now been stopped up by HMRC.

The Guardian has already made an apology to the retailer for errors in its first stories though, and Tesco has now been told that it has until September 15 to make a decision as to whether to accept this, with whatever damages are agreed between the parties. There is also a matter of a claim of 'malicious falsehood' against the Guardian and its editor which has been held over. Much depends on what Tesco's board now decide to do, it could take the case on to the court of appeal, or it could settle under the 'Offer of Amends' special regime which is in place to settle cases like this without the need for expensive litigation.

The case has been somewhat embarassing for Tesco which argues that its tax avoidance is counter balanced by charitable schemes and donations. Its defence for not admitting the newly uncovered schemes as evidence in the lible preliminaries was based on the notion that tax avoidance is a "grey area" in which companies divide their avoidance tactics between "aggressive" and "non-aggressive" tax planning behaviour. Non-aggressive being seen as morally/socilally acceptable. This idea is not new in big business circles and HMRC's Dave Harnett alluded to it in a podcast earlier in the year. The subtle difference between what constitutes 'good' and 'bad' tax avoidance was not entertained by Mr Justice Eady, he took the newspaper's view that it was not fair to take any decisions "in blinkers". It seems that every little tax avoidance scheme does count, after all.