Yorkshire Water 'acts malevolently' over corporation tax

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A water firm has been accused by an MP of using tax laws "malevolently" after paying no corporation tax in the past year - despite making £186m profits.

Yorkshire MPs have held a meeting with Yorkshire Water at the House of Commons to discuss the issue.

The firm has said it is in "total compliance" with tax rules.

Conservative MP for Skipton and Ripon Julian Smith said the MPs would be debating in Parliament how those rules could be changed.

Mr Smith acknowledged Yorkshire Water was doing nothing illegal, but maintained the firm had acted in a "malevolent way" whilst there had been 6.6% average rise in water bills last year.

'Taxpayer loses out'

"It does come down to the corporate behaviour of individual firms," he said.

"The rules that allow Yorkshire Water to do some of the things they are doing are quite legitimate and they're useful to many companies

"But, if they are taken to the extent that Yorkshire Water is doing, if they are used in a malevolent way, then the taxpayer loses out."

After meeting with Yorkshire Water bosses, Mr Smith said he was disappointed that while they had explained their situation there was "no sense of contrition and no apology".

In a statement, Yorkshire Water said it was happy to discuss its tax arrangements with the MPs and claimed the firm invested "more than £1m every day" in the regional economy.

"As a wholly UK tax resident company, we pay our tax in full and in total compliance with HMRC rules so we are concerned that some MPs have raised questions about the amount of tax we pay," it said.

"We have always been completely open and transparent about our accounts.

"We recently published our annual report which includes a full explanation of why the business is structured the way it is, how it is financed and how the government calculates how much corporation tax we have to pay."

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