Tech giants Oracle, Xerox, Dell, CSC and Symantec paid no corporate tax in the UK last year despite pocketing nearly £500m from public-sector IT contracts, it was claimed last night.

According to a study undertaken by Charlie Elphicke, Conservative MP for Dover, the five US behemoths banked taxpayers' cash and had a combined UK sales figure of £7bn, yet "paid no corporate tax whatsoever". The Tory revealed his findings during a House of Commons debate on tax avoidance.

Corporation tax is paid on profit and was set at 24 per cent in 2012, although organisations can use legal loopholes to minimise their payments.

Elphicke told Parliament that according to his research, ten tech companies, which he did not list in totality, received £1.8bn in public funds but coughed up just £78m in tax on UK earnings of £3.3bn, "resulting in a tax liability of £879m".

"We are seeing big business tax avoidance on an industrial scale. To me, it is unacceptable, unethical and irresponsible. We urgently need reform," he told fellow MPs on the record.

"No government contracts should be awarded to businesses that are fleecing our tax system, and the government should examine how much UK tax companies pay when deciding who gets plum government contracts."

According to Elphicke:

Oracle paid no UK corporation tax last year because the firm claimed it made no profit in Blighty despite turning over £1.4bn. Oracle has a global operating margin of 32 per cent that would have equated to profits of £446m.

paid no UK corporation tax last year because the firm claimed it made no profit in Blighty despite turning over £1.4bn. Oracle has a global operating margin of 32 per cent that would have equated to profits of £446m. Microsoft was also given a special mention as it inked about £700m worth of government IT contracts and had revenues of roughly £2.35bn in our country. Its projected profits - based on the company's 40 per cent margin - were therefore £945m, which would have resulted in a tax bill of £246m but it actually stumped up £19m.

was also given a special mention as it inked about £700m worth of government IT contracts and had revenues of roughly £2.35bn in our country. Its projected profits - based on the company's 40 per cent margin - were therefore £945m, which would have resulted in a tax bill of £246m but it actually stumped up £19m. IBM was also of "concern" as it turns over about £4bn in the UK and profits were estimated at £642m. But its declared profits for the country were £327m, so it paid £41m tax rather than £167m.

Frank Field, Labour MP for Birkenhead, said HMRC taxmen should issue "kitemarks" for firms believed to have paid a "fair share of taxes", thus creating a "white list" of suppliers suitable for the public sector.

Tax receipts from big biz in the UK fell by a fifth from £26bn in fiscal 2011 to £21bn in fiscal 2012. The Commons debate effectively moved the spotlight further afield from Amazon, Google and Starbucks, whose executives were forced to defend their firms' tax chicanery at a Public Accounts Select Committee hearing in November.

But last night Ian Swales, Lib Dem MP for Redcar, singled out more corporations - including Vodafone, Accenture, CSC and Apple - as well as the massive online bazaars. Various companies under-fire for their lightweight tax payments have insisted they are following the letter of the law and have denied any wrongdoing.

More online giants in the MPs' firing line

"Our high streets are now subject to global competition," Swales told the House last night. "Most retailers are competing not only with the unstoppable rise of the internet but with offshore-based giants such as Amazon and eBay. The list of national and local UK businesses that cannot compete will get longer and longer: Comet was the latest to go broke, just before Christmas, probably costing the UK taxpayer £50m."

Swales said $13trn in cash is piling up in tax havens across the world which was the total GDP of the US and Japan - or "enough to buy the entire London stock market four times over".

John McDonnell, Labour MP for Hayes and Harlington, voiced disbelief that Capgemini coughed up just £308,000 in corporation tax last year on profits of £38m when it is the lead contractor for HMRC's £8bn Aspire project.

"That company is employed by HMRC but avoids the tax that HMRC seeks to use it to collect. It is extraordinary," he said.

Similarly, Accenture has a £9.6m* deal with HMRC to provide tech support, and forked out £2.8m in corporation tax on profits of £82m in the UK.

"It was employed by HMRC and awarded a massive contract, and then used those resources to avoid paying tax. You couldn’t make it up, but it is happening regularly," McDonnell claimed.

Swales also suggested Her Majesty's tax collectors build a "national tax system operating in an international world" to police the UK's financial borders and enforce transparency to tap into "consumer power" as witnessed recently with Starbucks: the "coffee" chain agreed to cough up £10m in tax over the next two years irrespective of profits it makes in a bid to protect its brand after outcry at its zero-tax bill.

But according to Caroline Lucas, Green MP for Brighton, HMRC's ability to "crack down" on tax avoidance will be restricted by the government's decision to cut the department's headcount by 40,000 from 2005 levels.

The government's ability, or indeed willingness, to shut tax loopholes was also questioned by Michael Meacher, Labour MP for Oldham West and Royton, who introduced some party politics.

"A conventional view and a charitable view is that the government do the best they can, but are outgunned and outmanoeuvred by all those smart tycoons and multinationals who employ an army of accountants and lawyers to run rings round the flat-footed regulators and tax inspectors who are always behind the curve," he told the House.

"That is, in my view, a pastiche of the truth. The reality is that the government … far from cracking down on tax dodgers, not only turning a blind eye to all but the most egregious examples of tax misfeasance, but actually promoting some of the most brazen examples of tax avoidance." ®

Updated to add

* Accenture has contacted us to say that its contract with HMRC is worth £9.6m, not the £9.6bn stated by Hansard - the official Parliamentary record that claims to provide an "edited verbatim report of proceedings of both the House of Commons and the House of Lords".