This article is from the source 'guardian' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.

You can find the current article at its original source at http://www.guardian.co.uk/business/2013/jun/16/ofwat-jonson-cox-tax

The article has changed 2 times. There is an RSS feed of changes available.

Version 0 Version 1
Ofwat chairman Jonson Cox attacked over his old water company's tax affairs Ofwat chairman Jonson Cox attacked over his old water company's tax affairs
(4 months later)
The head of the water industry watchdog has been accused of extraordinary hypocrisy for criticising the "morally questionable" tax structures in the sector after it emerged that Anglian Water hardly paid any corporation tax over the six years he was its chief executive.The head of the water industry watchdog has been accused of extraordinary hypocrisy for criticising the "morally questionable" tax structures in the sector after it emerged that Anglian Water hardly paid any corporation tax over the six years he was its chief executive.
Jonson Cox, now chairman of Ofwat, suggested last week that some corporations had a moral case to answer over allegations by campaign groups and MPs that they had used "shareholder loans to avoid UK taxation" through complex offshore holding structures. He described "some aspects" of the structures as morally questionable.Jonson Cox, now chairman of Ofwat, suggested last week that some corporations had a moral case to answer over allegations by campaign groups and MPs that they had used "shareholder loans to avoid UK taxation" through complex offshore holding structures. He described "some aspects" of the structures as morally questionable.
The comments followed the Observer's revelation last year that water companies across the country were paying little or no tax on huge profits. Some have reduced their tax bills to nothing by offsetting the interest payments on debts, often inter-company and involving tax havens, while also claiming allowances for spending on infrastructure.The comments followed the Observer's revelation last year that water companies across the country were paying little or no tax on huge profits. Some have reduced their tax bills to nothing by offsetting the interest payments on debts, often inter-company and involving tax havens, while also claiming allowances for spending on infrastructure.
Now it has emerged that under Cox, who joined Ofwat this year, Anglian Water paid a net total of £1.6m in corporation tax on its profits between 2004 and 2010. In three of those years the company received a tax credit from the exchequer, while its share price soared and huge dividends were paid out. Cox resigned from Anglian Water in January 2010, departing with a payout of £9.5m in salary, pensions and bonuses, according to accounts filed at Companies House.Now it has emerged that under Cox, who joined Ofwat this year, Anglian Water paid a net total of £1.6m in corporation tax on its profits between 2004 and 2010. In three of those years the company received a tax credit from the exchequer, while its share price soared and huge dividends were paid out. Cox resigned from Anglian Water in January 2010, departing with a payout of £9.5m in salary, pensions and bonuses, according to accounts filed at Companies House.
Anglian Water serves five million customers from Grimsby in the north to Basildon in the south, and is owned by Canadian and Australian pension and infrastructure funds. The company's immediate parent undertaking is Anglian Water Services Overseas Holdings Ltd, a company registered in the Cayman Islands, a tax haven.Anglian Water serves five million customers from Grimsby in the north to Basildon in the south, and is owned by Canadian and Australian pension and infrastructure funds. The company's immediate parent undertaking is Anglian Water Services Overseas Holdings Ltd, a company registered in the Cayman Islands, a tax haven.
In 2009, Johnson's last full year at the firm, it was paying off interest on hundreds of millions of pounds worth of eurobonds at a rate of 10% a year, heavily reducing its corporation tax liabilities.In 2009, Johnson's last full year at the firm, it was paying off interest on hundreds of millions of pounds worth of eurobonds at a rate of 10% a year, heavily reducing its corporation tax liabilities.
Charles Walker, the Tory MP for Broxbourne, said he found Cox's comments last week "extraordinary" given the Ofwat chairman's past. He said: "I imagine that when Jonson Cox starts lecturing those executives still in the industry there is a fair amount of cheek-sucking." Walker said that Ofwat had failed to address environmental concerns and was focused entirely on pushing water prices down.Charles Walker, the Tory MP for Broxbourne, said he found Cox's comments last week "extraordinary" given the Ofwat chairman's past. He said: "I imagine that when Jonson Cox starts lecturing those executives still in the industry there is a fair amount of cheek-sucking." Walker said that Ofwat had failed to address environmental concerns and was focused entirely on pushing water prices down.
The scale of tax avoidance at many water companies will be a focus of Unison's water, environment and transport conference on Sunday where its general secretary, Dave Prentis, will call for a national inquiry. A report from Unison will say that more than £100 a year – 30% – of an average household water bill goes on profit, compared with 9% in the energy sector. In the last 10 years water bills have risen by 64% compared with 28% for average earnings, and would be £71 a year lower if bills had done no more than keep up with earnings. Prentis told the Observer: "A national inquiry and a freeze on water prices is the only antidote to a rapacious practice that is driving struggling families into water debt."The scale of tax avoidance at many water companies will be a focus of Unison's water, environment and transport conference on Sunday where its general secretary, Dave Prentis, will call for a national inquiry. A report from Unison will say that more than £100 a year – 30% – of an average household water bill goes on profit, compared with 9% in the energy sector. In the last 10 years water bills have risen by 64% compared with 28% for average earnings, and would be £71 a year lower if bills had done no more than keep up with earnings. Prentis told the Observer: "A national inquiry and a freeze on water prices is the only antidote to a rapacious practice that is driving struggling families into water debt."
An Ofwat spokesperson said: "As our chair, Jonson Cox is using his insight into the sector to shine a light on what companies do, and asking challenging questions to ensure that the legitimacy of the sector is maintained in the eyes of customers." A spokesman for Anglian Water denied that it engaged in tax avoidance. "Our corporation tax bill is reduced by specific government incentives and deferred, not avoided. This is allowed by the government to encourage long-term investment in infrastructure and jobs."An Ofwat spokesperson said: "As our chair, Jonson Cox is using his insight into the sector to shine a light on what companies do, and asking challenging questions to ensure that the legitimacy of the sector is maintained in the eyes of customers." A spokesman for Anglian Water denied that it engaged in tax avoidance. "Our corporation tax bill is reduced by specific government incentives and deferred, not avoided. This is allowed by the government to encourage long-term investment in infrastructure and jobs."
Our editors' picks for the day's top news and commentary delivered to your inbox each morning.