FTSE 350 group wins Fair Tax Mark

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Andrew Goodall
Freelance tax writer
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Go-Ahead, the bus and rail operator, has become the first FTSE 350 company to be awarded the Fair Tax Mark, an accreditation scheme devised by a team of tax campaigners led by Richard Murphy.

The Go-Ahead group employs 23,000 people in the UK and operates the Southern, Southeastern and London Midland franchises. It won the Thameslink rail franchise earlier this year in a joint venture with Keolis, the French state-owned transport services operator.

Chief executive Dave Brown, announcing the group’s latest results today, said he was pleased the group had been recognised for an “open and transparent approach” to its tax affairs”.

Heather Self, a partner at the law firm Pinsent Masons, told AccountingWEB: “It must be encouraging for the Fair Tax Mark that a major company has signed up, but Go-Ahead are a UK business so requirements such as country-by-country reporting are not relevant. The real challenge for the Fair Tax Mark will be to get a major multinational on board.”

Meesha Nehru, research and policy officer at the Fair Tax Mark, said Go-Ahead “adopted a new group tax policy that best reflected their current practice and revised the way they present tax data in their accounts to provide information that met the Fair Tax Mark criteria”.

Go-Ahead’s annual report, published today said: “The Fair Tax Mark is a label for good taxpayers and companies that are open about tax affairs and seek to pay the right amount of corporation tax at the right time and in the right place.”

It added that “we have a board enforced policy not to undertake tax planning and not to use tax havens”.

Go-Ahead’s reference to “tax planning” rather than “tax avoidance” may surprise many tax professionals and other observers who have expressed concern over a lack of clarity in the public debate on tax issues.

A statement of the Fair Tax Mark’s guiding principles on corporation tax, set out in a second draft of criteria for multinationals released yesterday, said: “The principles we are promoting directly relate to two of the seven tax principles that the CBI promotes, which say: ‘UK businesses should only engage in reasonable tax planning that is aligned with commercial and economic activity and does not lead to an abusive result …’”

The Fair Tax Mark team has invited comments on the second draft by 11 September. Draft assessment criteria for multinational companies were first published on 26 June, with a note describing the project as “evolving and consultative”. However, a deadline of 10 July was set for comments on the first draft. An extension to 17 July was announced via Twitter on 11 July.

Some commentators complained that the initial “consultation” period was too short. Maya Forstater, a writer and researcher specialising in sustainable development, wrote on 29 June that it was a “blink-and-you’ll-miss-it” consultation. But she thought the Fair Tax Mark was “a good idea”.

Fair Tax Mark Limited, a community benefit society, was established in February 2014. Richard Murphy, tax justice campaigner and director of Tax Research LLP, is its technical director.


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By fcablog
04th Sep 2014 11:25

Paying the right amount of tax at the right time and place

While this is undoubtedly good news for the Fair Tax Mark itself, passengers on GOG-controlled Southeastern Railway's train services will be wondering if this is some sort of sick joke.

As passengers cram themselves onto Southeastern's woefully poor train services - permanently overcrowded, often late and subject to chronic disruption at any time - will they find any comfort at all in the idea that Southeastern pays tax at the right time and in the right place? It's quite apparent that it cannot get its trains to turn up in the right place at the right time.

And as the Fair Tax Mark waxes lyrical about GOG's innovative tax disclosures, this is no help at all for Southeastern's passengers who would rather that GOG prioritised its resources away from telling FTM about tax and toward telling them about why - yet again - their services to and from work are disrupted.

Thanks (1)
05th Sep 2014 12:29

To be fair, I don't think the Fair Tax Mark people ever promised to be able to fix the problems of late running trains. They don't do world peace either!

GOG are hardly the only train operators to have problems of this kind.



Thanks (1)
04th Sep 2014 14:03

Unpopular company gets cheap PR

Has the Fair Tax Mark actually gained any credibility since it was first announced? I cannot help noticing that the linked criteria are STILL A DRAFT. That being the case, surely the Mark itself is entirely meaningless. How can they be granting the Mark if they still cannot clearly say what a business achieving this status has actually done.

That's even before you get into the debate over whether an unaccountable private organisation that charges people for an assessment is really an impartial judge anyway. As noted when the scheme first came out, it seems ripe for corruption. Has that improved any either?

Cheap, meaningless PR for Go-Ahead from where I'm standing.

Thanks (1)
04th Sep 2014 17:19

Is there

A case for every Company who tenders for any contract with any Government department to be registered with this scheme The recent announcement that the Aspire (Cap Gemini) HMRC  IT support contract was about to be broken up would be a point in case This contract costs HMRC ie you and me  Just short of £1 billion per year and under these new guidelines the contract would be fragmented over at least  10 suppliers with a contract gross of £100M per annum. Don't get me wrong I am not a supporter of this new fragmentation approach but if it is implemented then its a good time to ensure that the criteria governing the bidding process includes a stipulation that each bidder has a Fair Trade Mark and pays its main taxes in the UK. Currently Cap Gemini, a privately owned  French Company would appear to have  paid little or no tax on any of the profit earned from its HMRC £10 Billion  contract.

Perhaps Mr Gauke could be asked to explain how this was allowed to happen on his watch, its a fair question as its a matter of record  Mr G has based his whole approach to matters of tax on fairness.

Now where can I acquire some shares in this "Fair Tax" Company? 

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05th Sep 2014 09:11

Vehemently opposed

mikefleming3028 wrote:
A case for every Company who tenders for any contract with any Government department to be registered with this scheme
This is a ridiculous proposal for a number of reasons.

First, as I have already pointed out, the Fair Tax Mark people do not appear to have even decided for certain what they stand for. I may well disagree with their final version as well, but not even having a final version is a ludicrous position.

Second, they are still offering accountants the opportunity to be Fair Tax Assessors. As I pointed out when this was first mooted, there is a clear conflict of interest for an accountant as assessor seeking the Mark for their client. There is the "double-checking" portion of accreditation, but that hardly seems a difficult hurdle to overcome for an intelligent adviser. If the Mark is to have any credibility at all, it needs completely independent assessors.

Finally, and most crucially for me, you are talking about handing control of government spending over to a private individual. Richard Murphy does not exactly have a history of calm, measured pronouncements and clearly has his own agenda. You are effectively saying he should be given the power to kill the businesses of anyone who disagrees with him, with no recourse. I am horrified at the suggestion that any unaccountable private individual should be granted such power. You may say Fair Tax Mark is a group, not one man. To that I say, how many other people do you see mentioned in connection with it in the article.

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05th Sep 2014 09:39

In danger of personalising this a bit too much?

This is a sensitive subject, Stepurhan, and while I can see where your logic is coming from I think your scenario is going out on a limb when you start focusing on Richard Murphy's supposed power to kill businesses and control government spending.

You mention that Richard does not exactly "have a history of calm, measured pronouncements", but if you were to review your comments in the cold light of day, does that phrase not ring any bells?

You may not agree with him, but please don't fall into the trap of people who are only able to vilify the individual rather than taking on his arguments. It's worth pointing out that Fair Tax Mark is at heart a marketing, and in this area Murphy and his cohorts have run rings around the tax profession. [It's a battleground where cheap, meaningless PR can be very effective - look at the activities of any politician from David Cameron to Boris Johnson and Ed Milliband down]. Unless you and other of his opponents recognise this is a battle of ideas, you will struggle to win hearts and minds in the wider population.

So by all means point out practical issues and flaws in the Fair Tax Mark regime, but within AccountingWEB at least, please focus on technically based arguments that deal with accounting issues rather than making personal attacks on particular individuals.

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06th Sep 2014 18:05

Fair point

John Stokdyk wrote:
You mention that Richard does not exactly "have a history of calm, measured pronouncements", but if you were to review your comments in the cold light of day, does that phrase not ring any bells?
Fair point, but I wouldn't give me final say over who could bid for government contracts either.

At the end of the day, regardless of who is behind it, the Fair Tax Mark is a private organisation. To say that all businesses bidding for government contracts have to do business with this private organisation first is what I object to. They are the only ones who can grant a Tax Mark, and they charge for the assessment. to insist on companies having the Fair Tax Mark would effectively be granting a government contract by default. However, there would be no actual contract, and hence no ability to revoke the contract if they prove unsatisfactory. No government is going to say that they no longer want companies to prove fair tax dealings if such a measure was implemented. Given the lack of clear criteria, and the concerns I've raised about assessors conflict of interests, this should not happen in the first place.

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