Britain's rail firms have been accused of channelling money which should be used for investment into dividends for their shareholders.
The National Union of Rail, Maritime & Transport Workers (RMT) says 'deferred tax' funds which should be poured into improving Britain's rail transport network are instead providing "massive" boosts to dividend payouts.
Its report says the rail industry's six largest train-operating companies and three rolling-stock leasing companies are effectively avoiding having to pay a total of £1.3 billion.
Report author Richard Murphy said: "Rail companies are hiding behind accounting rules when presenting their figures that let them suggest they're paying more tax than they are, and that means the massive hidden subsidy the tax system gives them is not apparent. It should be."
RMT general secretary Bob Crow called on the nine firms to pass the profits on to passengers and use them to fund railway engineering works.
"Passengers are facing a future of massive fare increases and the government is cutting direct subsidy to the rail industry by £1.5 billion over the next six years, yet these private companies are sitting on a tax-break nest-egg worth £1.3 billion. It might be legal but it shouldn't be," he said.
Mr Crow admitted that the government was cutting its rail subsidy by £1.5 billion in the next six years.
© Adfero Ltd
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