Tax avoidance like David and Goliath, says Hodge

Four of the largest accountancy firms have defended themselves against claims they are behind tax avoidance schemes that damage the UK's interests.

MPs on the Public Accounts Committee accused them of making corporate taxable income "vanish into thin air", but tax officials from PwC, KPMG, Ernst & Young and Deloitte said many common assumptions about avoidance schemes were wrong.

The chairwoman of the committee, Margaret Hodge, said it was very difficult to define what is illegal tax evasion.