Fair Tax – it matters!

Corporation tax avoidance has topped public concerns about business ethics for 11 years running. It’s Fair Tax Week, and there’s never been a more important time to talk about why this matters, and for us at the Good Business Charter, it’s also a great opportunity to spotlight why fair tax is one of our 10 core components. 

The impact of fair tax 

First things first – the Good Business Charter is all about showing everyone you are behaving responsibly and doing the right thing. We talk about caring for colleagues, for customers, for suppliers and of course for the planet. Not paying our fair share of tax isn’t hurting anyone, is it? 

Well of course the truth is that companies that don’t pay their fair share of tax are essentially depriving the government of money they need to improve the lives of all these stakeholders and care for the planet too. If businesses want to recruit people who have a decent standard of education and who have access to good quality healthcare when needed they should be paying their fair contribution into that. 

Businesses can take for granted the relative security they enjoy operating in Britain as well as the infrastructure they rely on for their colleagues to get to work, their customers to visit them and suppliers to get goods to them. All of this needs paying for. This is why Fair Tax Week really matters.   

A matter of fairness and competition 

It matters to businesses who are doing the right thing by paying corporation tax but find they are not operating on a level-playing field because competitors are paying lower taxes through havens, all-out non-payment or artificially constructed systems to minimise their tax burden and can therefore undercut them or simply enjoy higher profits. 

That’s why the Good Business Charter recognises and values organisations that have achieved Fair Tax Mark accreditation — a rigorous independent standard that confirms a company is committed to transparent and responsible tax practices. While it’s not a requirement for GBC accreditation, having the Fair Tax Mark adds extra weight to a company’s ethical credentials and publicly reinforces their commitment to paying their fair share.

Leeds Building Society is a great example of this in action. They proudly display their commitment to fair tax with a dedicated webpage titled “Why we care about Fair Tax”, outlining their transparent approach to taxation and why paying the right amount matters. By doing so, they’re not just meeting compliance requirements — they’re building trust and accountability with their customers, communities and employees, modelling exactly the kind of behaviour we need more of in the business world. 

But more than that, and why it is most definitely one of our 10 components, the general public is absolutely incensed about the topic. In fact, the Institute of Business Ethics Public Attitudes survey for the past 11 years, yes that’s 11 years, has corporation tax avoidance as the number 1 thing that annoys them about businesses. 

Not everyone qualifies 

For most UK businesses paying taxes is a standard activity – don’t they say the only thing certain in life is death and taxes! Yet not everyone is doing their bit and playing fair. Don’t be fooled – I have had conversations with businesses that cannot join the Good Business Charter because they cannot commit to our tax component – which means they cannot commit to a statement on tax avoidance.   

Quite frankly this shouldn’t be acceptable in Britain – to sit by whilst there is a tax gap of £39.8 billion.  According to thinktank TaxWatch, corporation tax makes up a greater than ever proportion (34%, double that in 2018-19) of this tax gap versus other major taxes where the gap proportion is flat or falling and small businesses are interestingly the worst offenders.  

A call to business leaders 

So this Fair Tax Week, we’re proud to stand alongside those calling for change. Paying fair tax isn’t just a legal obligation — it’s a social contract. It’s about contributing to the society we all depend on, and showing that you do business with integrity. 

If your organisation is already doing the right thing, we encourage you to get recognised for it. If not, perhaps now is the moment to reconsider what responsible business truly means.