News, views and top stories in your inbox. Don't miss our must-read newsletter Sign up Thank you for subscribing We have more newsletters Show me See our privacy notice Invalid Email

Some of Britain’s biggest water companies are raking in billions of pounds in profits without paying a penny in tax.

The 19 water firms made profits of more than £2.05billion in 2013, handed out £1.86billion to shareholders but paid just £74million in tax. Seven of them paid no corporation tax at all.

The figures also show the industry is failing to help customers struggling with sky-high bills.

Bills have rocketed by 313% since the Tories privatised the industry 25 years ago this week and 12.5% since the Coalition came to power in 2010.

The average household bill for water and sewage is £393 a year.

But the private firms are making massive profits.

313% Amount water bills have increased by since the Tories privatised the industry 25 years ago 12.5% Amount water bills have increased by since the coalition came into power in 2010

The largest, Thames Water, has made more than £1.8billion between 2008 and 2013 and paid more than £1.4billion to its shareholders.

It paid just £2.3million in corporation tax in that period.

In 2013 it was one of seven water firms not to pay any corporation tax. The others were Northumbria, Severn Trent, Yorkshire Water, Sembcorp, Portsmouth and the not-for-profit Welsh Water.

Many of the companies also get tax breaks from the Government.

But Labour said some firms were deliberately loading themselves with debt to avoid corporation tax.

Shadow Environment Secretary Maria Eagle said: “It’s unacceptable that some firms paid no tax in 2013 while millions of customers are struggling. David Cameron has done nothing to tackle the problems in the water industry.”

Water UK, the umbrella body for the industry, said: “When companies invest for the future they can defer – but not avoid – corporation tax due to the tax relief on capital allowances.

“This reduction in tax has led directly to lower customer bills.”