At the recent Blueprint for Better Business conference, the Chairman of BT condemned companies who paid nothing in tax. ‘Perception is reality’, he reminded them, and being a good citizen in other respects is not enough. As a former MP I know better than most that ‘sticking by the rules’ is a feeble, insufficient defence for unpopular and unwise decisions on financial management.

Regardless of the rules, companies, whether large or small, have six duties. At a local level, the owner and the market place make legitimate demands on corporate loyalty. Nationally, there are duties to stakeholders including customers, employees and supply chains which not all businesses yet fully take on board. There is also the national duty to pay towards the common good through taxation. Finally, there are two global duties- a level to which few major corporates or SMEs have yet ascended. They are: to behave as a corporate citizen, engaged proportionately in the life of the community which it shares with others; and to take proper cognisance of the demands of the longer term future. This latter concerns resource management and depletion, controlling climate change and taking a generational view of company finances, rejecting short termism.

As well as the duties of business in these regards, it is also the duty of government to levy said taxes fairly. But this should not mean encouraging responsible business behaviour through taxes. For example, some have proposed that tax concessions on council, income and corporate taxes might be used to reward positive social behaviour such as volunteering (including corporate volunteering). The idea of using taxes as incentives for behaviour is not as pro-social as its proponents would like to believe. It would, first of all, be a waste of money: many corporates and individuals are happy to behave positively without this stimulus.

For example, several times recently I have heard conference speakers make a valid case for corporate volunteering. Some such speeches contain a late, throw-away phrase: ‘Supported by tax concessions.’ This is irresponsible.

Paying tax is the way we do good by proxy; reducing tax income to reward good behaviour must be justified by a greater return on the investment by the tax-levying authority, government or council. This means that the increased ‘good’ from corporate and personal behaviour promoted by lower taxes must be more than the ‘good’ the taxation would otherwise have funded. A ‘reduced tax for good behaviour’ model incurs administration costs. Someone has to decide what activities should be included, who qualifies and that claims are genuine. Such a scheme would generate resentment amongst those who are not so rewarded, create dependency and damage ‘non-subsidised’ good behaviour.

Taking an example from council tax, Lambeth Council reserves some funds to provide facilities in communities where voluntary effort has been positive, such as where local composting targets have been met. It is surely better to reward communities in this way (taking tax out of the argument) rather than individuals. The same can be applied to corporations.

A 2013 consultation by BIS on how government might promote corporate social responsibility was due to publish its conclusions in December of last year. A slim volume finally appeared in May, containing nothing more than a summary of evidence received (including mine). Of Government conclusions, not least whether tax incentives should be part of any programme to promote good behaviour, there were none.

And that, I hope, is how it will stay.

Tom Levitt is the author of “Welcome to GoodCo”