Re: Facilitating Evasion
Corporation tax is a tax on profits.
Profits = the money you made selling something - the cost of making and selling it.
"tax deductible" just means you are allowed to claim it as part of the expense of making or selling your goods or services. So for a bakery the flour, sugar, water, electricity, rent, advertising, running the delivery van, wages are all "tax deductible".
If nothing were deductible then corporation tax would be a tax on sales and not a tax on profits. At which point most small businesses would think sod this and shut up shop. Large businesses would move to somewhere with a saner tax system, and you would be paying twice as much for psudo bread at the big supermarket.
There is a massive amount of case law about what is tax deductible and what is not and it is constantly changing at the margin. If you drive your bread van home in the evening is this a legitimate expense of baking bread or are you getting a free ride home?