MULTINATIONALS are a step closer to claiming a tax rebate worth billions of pounds, but a leading tax expert says their claim is “opportunistic and abusive.”

A large line-up of companies, led by British American Tobacco, claim they were unfairly penalised by the advance corporation tax system between 1973 and 1999 for having overseas subsidiaries.

A monolithic law suit was sparked when it was claimed such a penalisation contradicted European anti-discrimination rules enshrined in the Treaty of Rome.

In the latest round, a High Court judge ruled out the Treasury’s defence that it could not pay companies back because it had already spent the money.

Mr Justice Henderson found in the claimants’ favour on two technical issues, including whether the case should take into account how much tax the companies’ subsidiaries had paid in other countries.

But Tax Research LLP director Richard Murphy told the Star that “nobody knew (the practice of favouring companies entirely based in the UK) was illegal” until the mid-1990s shortly before chancellor Gordon Brown legislated to end it.

“The companies are behaving in a fashion that is opportunistic and abusive. How can you say a government acted illegally when nobody knew it was illegal?” he said.

“A game of legal ping pong is being played out — the companies have taken a small step this week, but there will inevitably be an appeal.”

He said the sums concerned — estimated to be £4.5 billion — were so large that it was worth both sides paying hefty legal fees to keep up the fight.