TAX EXPERTS were divided yesterday over whether Welsh small traders’ plan to register their businesses offshore to push HM Revenue and Customs (HMRC) into closing loopholes was “jolly clever.”

Shop owners in Crickhowell, Powys, submitted tax-avoiding plans to HMRC based on ones used by corporate giants such as Facebook and Caffe Nero.

The “Powys tax rebellion” — to be televised in a BBC documentary — involves a salmon smokery, coffee shop, bookshop, optician and bakery that serve 2,800 residents.

Now, the owners want other towns to do the same.

Jo Carthew, who runs Black Mountain Smokery, said: “These complicated offshore tricks had only been open to big companies who can afford the lawyers’ fees.

“But we’ve put our heads together, and worked out a way to mimic them.

“It’s jolly clever.”

One of the traders discovered that he paid seven times more corporation tax than Facebook, which coughed up less than £5,000 last year.

Caffe Nero, which has not paid tax in Britain for seven years, recorded sales worth £1.2 billion.

Ms Carthew added: “We do want to pay taxes because we all use local schools and hospitals but we want a change of law so everyone pays their fair share.”

John Christensen, director of the Tax Justice Network, applauded the traders.

He told the Star: “Bravo to the independent shop owners for fighting back against the big business tax cheats.

“For decades multinational companies have gamed the system with sophisticated tax haven schemes, and successive governments have turned a

blind eye even though they’ve lost billions in tax revenue each year.”

But Richard Murphy, director of Tax Research UK, said he rejected an offer to appear in the documentary, as he considers it a “rather poor TV stunt” conceived by producers.

He added: “The shop owners are going the wrong way about it. If they succeed, it will be considered a normal thing for traders to do and I don’t get their logic.

“There are massive tax risks and they could be breaking the law in transferring assets offshore, which can actually increase tax liabilities and penalties if they do not declare them properly.

“I have a problem with their approach in drawing attention to the issue in this way.”

Mr Murphy said that the traders should instead join up to the Fair Tax Mark and lobby for other businesses to do the same.