Treasury urges firms to be more open on tax

The Treasury minister David Gauke is urging companies to "explain the story" after public protests about the amount of tax paid by big businesses. "We could have a better-informed debate if businesses were willing, perhaps, to be more transparent about the tax they pay... and explain the story behind the figures," Gauke will tell the Institute of Directors. He was speaking as HSBC revealed that it had paid $383m (£236m) in UK corporation tax – out of a total tax bill of $4.8bn – after reporting profits of $19bn in 2010. About $2.4bn in profit was made in the UK. The bank stressed that its actual corporation tax bill for the year was $750m. If payroll taxes, property taxes and VAT are included, it paid $1.8bn. For the first time since 2007, all the bank's divisions are now profitable, after the North American arm plunged to a $7bn loss a year ago. Douglas Flint, HSBC's chairman, hit out against George Osborne's permanent levy on bank balance sheets, which will cost HSBC about $600m. He said that if the chancellor removed it, the bank would increase its payouts to shareholders. The final dividend is 12 cents, up from 10 cents a year ago. The corporation tax bills of many banks are being kept low by losses made in the financial crisis. Royal Bank of Scotland and Lloyds Banking Group, which were bailed out by the government, are not yet paying the tax, while Barclays paid £113m in UK corporation tax in 2009, when it reported £11.6bn of profits. In a letter to the Guardian, Barclays said that it paid £1bn of corporation tax globally.