YOU say (Anger as water bills set to go up again, front page, Oxford Mail, August 13) that Thames Water paid no corporation tax last year “under a deal with Government”.
There is no “deal”. There are, rather, tax rules that apply to everyone.
HMRC’s ‘capital allowances’, which are applied based on how much a company invests, are available to all firms, not just Thames Water.
As we are currently investing a record £1bn a year upgrading our old pipes, sewers and other facilities, we receive significant capital allowances.
Under these allowances, corporation tax payments are delayed, not avoided and, as a result, customer bills are now reduced.
These deferred tax payments will all be paid in future years.
Capital allowances are detailed prominently on HMRC’s website. They are designed to boost the economy and have existed since 1878.
If they were not available, either our customers’ bills would be higher or we would invest less.
As it is, our bills are the second-lowest in the country and we are investing more than any water company ever has.
It is important to note that Thames Water contributes £150m a year in other forms of tax, including council rates, environmental charges and PAYE and NI off employees’ wages.
SIMON EVANS, Thames Water, Clearwater Court, Vastern Road, Reading
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