Written Question · S1W-31152 · Session 1
Whether any monitoring arrangements are in place to ensure that public money committed to purchase private sector goods or services is not …
The question
To ask the Scottish Executive whether any monitoring arrangements are in place to ensure that public money committed to purchase private sector goods or services is not committed to any organisation operating a tax avoidance policy by establishing accounts in offshore tax havens and, if not, whether it will investigate establishing such an arrangement to ensure that only firms that properly pay taxation within the UK benefit from public money used to purchase goods or services on behalf of the taxpayer.
The answer
No monitoring arrangements are in place in respect of tax avoidance schemes. However, organisations bidding for Scottish Executive contracts are expected to have met their legal obligations in respect of taxation and it is standard practice that they are asked to disclose any convictions.European public procurement rules provide for certain circumstances when companies can be excluded from competing for public sector business, such as failure to pay taxes in accordance with UK (or other relevant) legislation. However, it does not allow for exclusion of companies on the basis that they pay their taxes in another country. To exclude a company on these grounds would be unlawful. Generally, companies are required to pay taxes in the country of their incorporation. In the case of partnerships, partners are required to pay taxes in the country in which they are domiciled.
In the Official Report
No contribution in the Official Report cites S1W-31152 by reference.