As the tax backlash against large multinationals grows, STUART ARNOLD provides a brief lowdown.

Q: What’s this all about?

A: Several firms, including Amazon, Google and Starbucks have been accused of avoiding their UK tax obligations.

Q: What impact is this controversy having on the companies concerned?

A: Coffee shop giant Starbucks, which paid no tax on its £1.3bn of sales in the UK in the three years up to 2012, has been targeted by protestors who have boycotted its products. These include the group UK Uncut. All the companies concerned say they follow the rules and are breaking no laws.

Q: What is HMRC’s stance on this?

A: It says it has an “exemplary” record in challenging those who avoid tax and has denied it is soft on large businesses, having recovered £34bn in additional revenue in the last seven years.

Q: But the HMRC hasn’t been immune to criticism either?

A: No – MPs have repeatedly castigated HMRC, as well as the firms themselves. Most recently it came under fire for a scheme which allows the big accountancy firms to place staff within HMRC which critics say is a conflict of interest.

Q: It isn’t just the big retailers who have been criticised over their tax affairs is it?

A: No, recently Npower denied claims it was avoiding its tax obligations in the UK by shifting millions of pounds in profit to Malta. The company’s chief executive Paul Massara was quizzed by North-East Labour MP Ian Lavery, a member of the Commons Energy and Climate Change Select Committee, and admitted it had not paid corporation tax for three years.

Q: What is the Government is doing about this issue?

A: Prime Minister David Cameron said last year it was considering introducing new powers to prevent tax avoidance by big firms and wealthy individuals. But it could take many years before adequate legislation is put in place.