I am now racing through a short e-book, "Over here and under taxed" by Richard Murphy. It is very readable and I'm happy that he describes the business of Google, Amazon and Starbucks pretty much exactly as I'd understood them. he also promises substantive ideas on how to address the situation. At the start, his own political perspective shows a bit, and that will not please the likes of @Fiiish, which is a pity because I find his detailed analysis pretty convincing and something of interest to those tending to the right as well as the left of the spectrum, (as well as odd people like me who feel lonely and misunderstood in the centre :-)).
Cheap as chips as an e-Book only £1.99, from ..er...Amazon :-)
Not sure why you need to single me out. I'm open to ideas from all sides of the political spectrum as long as they're sensible and provide real solutions. There's plenty of other posters on this forum who instantly shoot down something because it didn't come from their favourite newspaper. If you'd bothered to read my first post in this thread, I'm all for making the likes of Amazon and Starbucks pay their fair share and I'd imagine the solution to that would likely come from the left rather than the right.
And in turn, I don't have any problem if you do have a right wing perspective, if as you say above, we can agree that on this issue there is no need to be too tribal. Your remark
"the boardrooms of Google and Starbucks aren't filled with goateed men with red pitchforks putting out their cigars in the eyes of disabled homeless people, despite the image that some people in the media and this thread are attempting to paint"
did not fill me with optimism, but that's often how it goes in threads, emails etc, people misunderstand each other and make assumptions, and I'm as guilty as anyone else.
Not sure how this can be considered to be a right-wing remark, unless simply stating facts is in now itself right-wing?
I also don't consider myself right-wing (I don't support Tories or UKIP), I just happen to be right of the people who call themselves left-wing.
I am now racing through a short e-book, "Over here and under taxed" by Richard Murphy. It is very readable and I'm happy that he describes the business of Google, Amazon and Starbucks pretty much exactly as I'd understood them. he also promises substantive ideas on how to address the situation. At the start, his own political perspective shows a bit, and that will not please the likes of @Fiiish, which is a pity because I find his detailed analysis pretty convincing and something of interest to those tending to the right as well as the left of the spectrum, (as well as odd people like me who feel lonely and misunderstood in the centre :-)).
Cheap as chips as an e-Book only £1.99, from ..er...Amazon :-)
Not sure why you need to single me out. I'm open to ideas from all sides of the political spectrum as long as they're sensible and provide real solutions. There's plenty of other posters on this forum who instantly shoot down something because it didn't come from their favourite newspaper. If you'd bothered to read my first post in this thread, I'm all for making the likes of Amazon and Starbucks pay their fair share and I'd imagine the solution to that would likely come from the left rather than the right.
And in turn, I don't have any problem if you do have a right wing perspective, if as you say above, we can agree that on this issue there is no need to be too tribal. Your remark
"the boardrooms of Google and Starbucks aren't filled with goateed men with red pitchforks putting out their cigars in the eyes of disabled homeless people, despite the image that some people in the media and this thread are attempting to paint"
did not fill me with optimism, but that's often how it goes in threads, emails etc, people misunderstand each other and make assumptions, and I'm as guilty as anyone else.
I just happen to be right of the people who call themselves left-wing.
Alright Jordan. That was a great goal on Saturday.
Personally I would just abolish corporation tax entirely.
Everyone bitching and crying about it needs to get some perspective. Companies like Starbucks and Google contribute billions of pounds in tax every year by employing people in this country. Their employment costs are huge and where does most of our wedge go? To HMRC. Then they pay 13.8% on top of our salaries as employers NI.
Politicians then go on a witchhunt over peanuts. I'd love one of them to know the answer to how much PAYE these companies cough up each year. Bet they don't and bet it dwarfs the amount of CT tax they have legally avoided.
Personally I would just abolish corporation tax entirely.
Everyone bitching and crying about it needs to get some perspective. Companies like Starbucks and Google contribute billions of pounds in tax every year by employing people in this country. Their employment costs are huge and where does most of our wedge go? To HMRC. Then they pay 13.8% on top of our salaries as employers NI.
Politicians then go on a witchhunt over peanuts. I'd love one of them to know the answer to how much PAYE these companies cough up each year. Bet they don't and bet it dwarfs the amount of CT tax they have legally avoided.
The response to that is simple. Sainsbury and John Lewis pay CIT. Amazon does not. Costa Coffee pays CIT. Starbucks does not. ITV companies pay CIT . Google and Facebook do not. you see the pattern? And you assert that the £6.75 BILLION that HMRC forgave Vodafone is "peanuts"? Wow.
Cheap as chips as an e-Book only £1.99, from ..er...Amazon :-)
Here's the biggest problem, you care enough to moan on a football forum but not enough to pay more elsewhere.
If people just said no to these companies and refused to use their services until they pay the correct taxes the companies would have little choice, as long as you are happy to support them to save a few quid nothing will change.
Personally I would just abolish corporation tax entirely.
Everyone bitching and crying about it needs to get some perspective. Companies like Starbucks and Google contribute billions of pounds in tax every year by employing people in this country. Their employment costs are huge and where does most of our wedge go? To HMRC. Then they pay 13.8% on top of our salaries as employers NI.
Politicians then go on a witchhunt over peanuts. I'd love one of them to know the answer to how much PAYE these companies cough up each year. Bet they don't and bet it dwarfs the amount of CT tax they have legally avoided.
Surely the problem is the advantage not paying the correct tax gives them over their competitors. How many book stores have closed as a result of Amazon, or independent coffee shops due to Starbucks? Those places all employed people too.
I am now racing through a short e-book, "Over here and under taxed" by Richard Murphy. It is very readable and I'm happy that he describes the business of Google, Amazon and Starbucks pretty much exactly as I'd understood them. he also promises substantive ideas on how to address the situation. At the start, his own political perspective shows a bit, and that will not please the likes of @Fiiish, which is a pity because I find his detailed analysis pretty convincing and something of interest to those tending to the right as well as the left of the spectrum, (as well as odd people like me who feel lonely and misunderstood in the centre :-)).
Cheap as chips as an e-Book only £1.99, from ..er...Amazon :-)
Not sure why you need to single me out. I'm open to ideas from all sides of the political spectrum as long as they're sensible and provide real solutions. There's plenty of other posters on this forum who instantly shoot down something because it didn't come from their favourite newspaper. If you'd bothered to read my first post in this thread, I'm all for making the likes of Amazon and Starbucks pay their fair share and I'd imagine the solution to that would likely come from the left rather than the right.
And in turn, I don't have any problem if you do have a right wing perspective, if as you say above, we can agree that on this issue there is no need to be too tribal. Your remark
"the boardrooms of Google and Starbucks aren't filled with goateed men with red pitchforks putting out their cigars in the eyes of disabled homeless people, despite the image that some people in the media and this thread are attempting to paint"
did not fill me with optimism, but that's often how it goes in threads, emails etc, people misunderstand each other and make assumptions, and I'm as guilty as anyone else.
Cheap as chips as an e-Book only £1.99, from ..er...Amazon :-)
Here's the biggest problem, you care enough to moan on a football forum but not enough to pay more elsewhere.
If people just said no to these companies and refused to use their services until they pay the correct taxes the companies would have little choice, as long as you are happy to support them to save a few quid nothing will change.
I already answered your point on page 1. Generally you are right, as for the personal element you included I outlined what steps I try to take. Richard Murphy has chosen to make his ebook available on Amazon, so that his book (which includes one of the most trenchant attacks on Amazon's tax arrangements i have ever read) is as widely read as possible. In order to get a big movement going, enough people need to know the facts. This thread contributes in a small way to that. Anyway, how will ordinary consumers hurt Google? They don't pay to search. As I pointed out, Googles' biggest customers are advertising agencies ( a sector I know you don't have much time for). Therefore the way to change this is for enough people to say to politicians, "enough is enough", and get them to work out a sensible response. That is what we pay politicians to do.
On page one, unless I've misread you, you suggested the vast amounts of tax these companies don't pay have no influence on their pricing. That's insanity.
Sadly I don't have any faith in the government of our, or any country doing anything about it. The threats of withdrawal and self preservation will see to that.
This is something the public can do something about, these places can only charge the prices they do because of the savings they make elsewhere, if Vodaphone paid the full amount of tax you believe they should their prices would go up, of that I'm sure. If you care enough, don't support it.
Companies like Starbucks and Google contribute billions of pounds in tax every year by employing people in this country. Their employment costs are huge and where does most of our wedge go? To HMRC. Then they pay 13.8% on top of our salaries as employers NI.
Politicians then go on a witchhunt over peanuts. I'd love one of them to know the answer to how much PAYE these companies cough up each year. Bet they don't and bet it dwarfs the amount of CT tax they have legally avoided.
This suggestion has been made a couple of times on this and other threads, surprisingly without challenge.
The fact is that employees pay PAYE Income Tax and Employee National Insurance on standard salary payments. Employers collect these taxes from their employees from salary due to be paid on payday, but the burden for these is not on employers.
If the government increased the rates of tax tomorrow (say, from 20p to 30p), that wouldn't affect the cost to my employers. It would hit me directly in my pocket in the form of a lower net pay, but the gross pay (ie cost to employer) would remain the same.
In industries with high mobility of workforce, such as financial services or oil/gas, sure there would be a burden on employers, as they would have to replace employees who leave to work in New York or Dubai etc, and it's likely they would have to offer higher wages to offset the tax rise. However, coffee baristas (Starbucks) and warehouse workers (Amazon) do not work in industries with high mobility of labour.
Similarly, VAT is ultimately paid by customers, but collected on behalf of HMRC by sellers. I would be very concerned if I encountered a medium to large business (anything bigger than a corner shop) that considered VAT to be part of its revenues - in every case I've encountered in working life, VAT was something added on after the final price (for both sales and purchases).
Of course, Employers' NI is a burden on employers.
Anyway, if the whole focus was to be on PAYE income tax and National Insurance as the main sources of tax revenue, then surely the government should be encouraging labour intensive companies (such as bookshops) rather than technology-driven companies (like Amazon).
On page one, unless I've misread you, you suggested the vast amounts of tax these companies don't pay have no influence on their pricing. That's insanity.
Sadly I don't have any faith in the government of our, or any country doing anything about it. The threats of withdrawal and self preservation will see to that.
This is something the public can do something about, these places can only charge the prices they do because of the savings they make elsewhere, if Vodaphone paid the full amount of tax you believe they should their prices would go up, of that I'm sure. If you care enough, don't support it.
Thinking about this more Stu - and I really agree with your sentiment - the other problem is that we don't necessarily know who is up to these tricks. I'd be the first to admit that a few years ago I was huge fan of Amazon, and for sure Google has transformed what we can get from using the Internet. I don't want to drum these companies out of business, I just want them to play fair and contribute to the societies they live from, like other admirable companies such as John Lewis do.
I bought a couple of CDs for a buddy earlier this week. I tried to buy them from Play.com so as to avoid Amazon. They only had one of the two CDs (even though they are from the same band and both less than two years old). But even if I had been able to use Play.com, how do I know they aren't up to the same tricks? If I don't use Amazon and my Kindle, the alternative is iBooks. I'm sure bloody Apple are up to it too.
I understand that you don't have faith in politicians but this is what they are here for. And if you don't have faith in them, well, like Russell Brand, you know what you must do...:-)
Tax only shifts money away from you and me and corporates so that politicians rather than individuals control where it is spent. It's shifting deck chairs on the Titanic. We currently have to borrow deck chairs to shift around, the objective should be to increase the country's GDP so we have more deck chairs. That means encouraging wealth creation and attacking wealth creators because they are rich might not be the best policy.
Tax only shifts money away from you and me and corporates so that politicians rather than individuals control where it is spent. It's shifting deck chairs on the Titanic. We currently have to borrow deck chairs to shift around, the objective should be to increase the country's GDP so we have more deck chairs. That means encouraging wealth creation and attacking wealth creators because they are rich might not be the best policy.
I suppose one snag is that all the new deck chairs have to be shipped in from China.......
Tax only shifts money away from you and me and corporates so that politicians rather than individuals control where it is spent. It's shifting deck chairs on the Titanic. We currently have to borrow deck chairs to shift around, the objective should be to increase the country's GDP so we have more deck chairs. That means encouraging wealth creation and attacking wealth creators because they are rich might not be the best policy.
Just so that I'm clear and don't waste everyone's time, are you suggesting that this is what I am doing in this thread? Or what Richard Murphy is doing?
I am now racing through a short e-book, "Over here and under taxed" by Richard Murphy. It is very readable and I'm happy that he describes the business of Google, Amazon and Starbucks pretty much exactly as I'd understood them. he also promises substantive ideas on how to address the situation. At the start, his own political perspective shows a bit, and that will not please the likes of @Fiiish, which is a pity because I find his detailed analysis pretty convincing and something of interest to those tending to the right as well as the left of the spectrum, (as well as odd people like me who feel lonely and misunderstood in the centre :-)).
Cheap as chips as an e-Book only £1.99, from ..er...Amazon :-)
Not sure why you need to single me out. I'm open to ideas from all sides of the political spectrum as long as they're sensible and provide real solutions. There's plenty of other posters on this forum who instantly shoot down something because it didn't come from their favourite newspaper. If you'd bothered to read my first post in this thread, I'm all for making the likes of Amazon and Starbucks pay their fair share and I'd imagine the solution to that would likely come from the left rather than the right.
And in turn, I don't have any problem if you do have a right wing perspective, if as you say above, we can agree that on this issue there is no need to be too tribal. Your remark
"the boardrooms of Google and Starbucks aren't filled with goateed men with red pitchforks putting out their cigars in the eyes of disabled homeless people, despite the image that some people in the media and this thread are attempting to paint"
did not fill me with optimism, but that's often how it goes in threads, emails etc, people misunderstand each other and make assumptions, and I'm as guilty as anyone else.
Not sure how this can be considered to be a right-wing remark, unless simply stating facts is in now itself right-wing?
I also don't consider myself right-wing (I don't support Tories or UKIP), I just happen to be right of the people who call themselves left-wing.
In fairness F do you really think that the media are literally blaming goateed men with pitchforks who are putting out their cigars and in the eyes of disabled and homeless people? You see I read it as an analogy, I may have been wrong, perhaps you really have read that, I would love to see a link to that? ;-)
But if I am right, and it is an analogy, I take it to mean that you think those directors are making their decisions in a philanthropic way, and not with profit and only profit in mind and nothing else, which is how it appears to me. So it stands to reason that some sections of the media are going to feel the same, and therefore report it how they see it. The right wing press more or less ignore it and blame all the problems on immigrants and benefit claimants. Therefore when knocking the section of the media and the contributors to this thread pointing out a left wing point of view, you are going to appear right wing, even if you are not. If that makes sense?
Hope I have explained myself properly, and not come across as having a dig, as that's not what I mean to do ( apart from the tongue-in-cheek first para ).
It's worth defining what a 'wealth creator' is. Amazon and Starbucks are not 'wealth-creators' - if Starbucks didn't exist, a UK-based coffee shop that paid its taxes in the UK would be in its place instead. Likewise, I'm sure a UK-based equivalent of Amazon would fill the void left if Amazon left the UK. Those consumers and all their money won't simply cease to exist. What Amazon and Starbucks are are wealth-drainers. High time the Government gave these companies a tax bill based on their global profits and not on some fiddled figure that amounts to zero.
Tax only shifts money away from you and me and corporates so that politicians rather than individuals control where it is spent. It's shifting deck chairs on the Titanic. We currently have to borrow deck chairs to shift around, the objective should be to increase the country's GDP so we have more deck chairs. That means encouraging wealth creation and attacking wealth creators because they are rich might not be the best policy.
Just so that I'm clear and don't waste everyone's time, are you suggesting that this is what I am doing in this thread? Or what Richard Murphy is doing?
Just making the case for a taxation regime that makes it uneconomic for Starbucks and Amazon to make the effort to avoid tax. That might lead to more tax revenue with more profits being left in the UK even if taxed at a lower rate.
Businesses come to the UK because it's a good business environment, they go to Luxembourg because they save tax. Luxembourg's GDP per capita is above £100k I think compered to our £25k? It is the easements which are needed in complex tax system like ours that create the loopholes in the system that are exploited. A lower tax regime clearly boosts Luxembourg's wealth, so isn't there a case for arguing that a lower UK tax regime will yield more tax than a punitive one? That our attraction for inward investment from abroad will increase even more? That more jobs will be created? That more wealth will be created?
Thinking that the multinational virtual businesses, who can choose where to pay tax, can be brought to heel with ever more esoteric tax rules that will be bomb-proof is wishful thinking, like most attempts to raise revenue with aggressive taxation. I heard Ken Livingstone on radio suggest the solution is to tax turnover. Can't think of a more ludicrous idea. It is an example of the crass idea that slapping a tax on something will increase the public coffers and the public will not be the ones to suffer the ultimate cost, it's a sum zero game.
The alternative suggestion for debating is to make Amazon and Starbucks want to pay tax in the UK by reducing taxation. Will not happen because it's not "fair", which carries far more weight and more votes than common sense.
Tax only shifts money away from you and me and corporates so that politicians rather than individuals control where it is spent. It's shifting deck chairs on the Titanic. We currently have to borrow deck chairs to shift around, the objective should be to increase the country's GDP so we have more deck chairs. That means encouraging wealth creation and attacking wealth creators because they are rich might not be the best policy.
Just so that I'm clear and don't waste everyone's time, are you suggesting that this is what I am doing in this thread? Or what Richard Murphy is doing?
Just making the case for a taxation regime that makes it uneconomic for Starbucks and Amazon to make the effort to avoid tax. That might lead to more tax revenue with more profits being left in the UK even if taxed at a lower rate.
Businesses come to the UK because it's a good business environment, they go to Luxembourg because they save tax. Luxembourg's GDP per capita is above £100k I think compered to our £25k? It is the easements which are needed in complex tax system like ours that create the loopholes in the system that are exploited. A lower tax regime clearly boosts Luxembourg's wealth, so isn't there a case for arguing that a lower UK tax regime will yield more tax than a punitive one? That our attraction for inward investment from abroad will increase even more? That more jobs will be created? That more wealth will be created?
Thinking that the multinational virtual businesses, who can choose where to pay tax, can be brought to heel with ever more esoteric tax rules that will be bomb-proof is wishful thinking, like most attempts to raise revenue with aggressive taxation. I heard Ken Livingstone on radio suggest the solution is to tax turnover. Can't think of a more ludicrous idea. It is an example of the crass idea that slapping a tax on something will increase the public coffers and the public will not be the ones to suffer the ultimate cost, it's a sum zero game.
The alternative suggestion for debating is to make Amazon and Starbucks want to pay tax in the UK by reducing taxation. Will not happen because it's not "fair", which carries far more weight and more votes than common sense.
As with most of the threads on this forum re: intelligent debate, I have a keen interest in wanting to contribute, but as soon as they get going I find myself hesitant to contribute due lack of knowledge on the subject. This has definitely been one of them.
However, this post was quite helpful. Basically, and correct me if I am wrong, what I think you are saying is that perhaps we should encourage a lower rate of corporate tax that applies to everybody, therefore removing all the complexities and loopholes of the current tax system. This way we encourage businesses to set up shop over here, create jobs, get a more consistent level of payments from corporations, do not have to spend 1000s of man hours, time & money fighting these companies and pressing hard on smaller businesses to make up for the shortfall.
Tax only shifts money away from you and me and corporates so that politicians rather than individuals control where it is spent. It's shifting deck chairs on the Titanic. We currently have to borrow deck chairs to shift around, the objective should be to increase the country's GDP so we have more deck chairs. That means encouraging wealth creation and attacking wealth creators because they are rich might not be the best policy.
Just so that I'm clear and don't waste everyone's time, are you suggesting that this is what I am doing in this thread? Or what Richard Murphy is doing?
Just making the case for a taxation regime that makes it uneconomic for Starbucks and Amazon to make the effort to avoid tax. That might lead to more tax revenue with more profits being left in the UK even if taxed at a lower rate.
Businesses come to the UK because it's a good business environment, they go to Luxembourg because they save tax. Luxembourg's GDP per capita is above £100k I think compered to our £25k? It is the easements which are needed in complex tax system like ours that create the loopholes in the system that are exploited. A lower tax regime clearly boosts Luxembourg's wealth, so isn't there a case for arguing that a lower UK tax regime will yield more tax than a punitive one? That our attraction for inward investment from abroad will increase even more? That more jobs will be created? That more wealth will be created?
Thinking that the multinational virtual businesses, who can choose where to pay tax, can be brought to heel with ever more esoteric tax rules that will be bomb-proof is wishful thinking, like most attempts to raise revenue with aggressive taxation. I heard Ken Livingstone on radio suggest the solution is to tax turnover. Can't think of a more ludicrous idea. It is an example of the crass idea that slapping a tax on something will increase the public coffers and the public will not be the ones to suffer the ultimate cost, it's a sum zero game.
The alternative suggestion for debating is to make Amazon and Starbucks want to pay tax in the UK by reducing taxation. Will not happen because it's not "fair", which carries far more weight and more votes than common sense.
Just making the case for a taxation regime that makes it uneconomic for Starbucks and Amazon to make the effort to avoid tax. That might lead to more tax revenue with more profits being left in the UK even if taxed at a lower rate.
Businesses come to the UK because it's a good business environment, they go to Luxembourg because they save tax. Luxembourg's GDP per capita is above £100k I think compered to our £25k? It is the easements which are needed in complex tax system like ours that create the loopholes in the system that are exploited. A lower tax regime clearly boosts Luxembourg's wealth, so isn't there a case for arguing that a lower UK tax regime will yield more tax than a punitive one? That our attraction for inward investment from abroad will increase even more? That more jobs will be created? That more wealth will be created?
Thinking that the multinational virtual businesses, who can choose where to pay tax, can be brought to heel with ever more esoteric tax rules that will be bomb-proof is wishful thinking, like most attempts to raise revenue with aggressive taxation. I heard Ken Livingstone on radio suggest the solution is to tax turnover. Can't think of a more ludicrous idea. It is an example of the crass idea that slapping a tax on something will increase the public coffers and the public will not be the ones to suffer the ultimate cost, it's a sum zero game.
The alternative suggestion for debating is to make Amazon and Starbucks want to pay tax in the UK by reducing taxation. Will not happen because it's not "fair", which carries far more weight and more votes than common sense.
But that's just a race to the bottom (assuming other countries say the same). You may as well just go straight to 0%. At least that would be a level playing field.
It's true that Amazon and Starbucks do emply people here. Most of teh jobs are low wage of course, so the taxpaer subsidises them by paying family credit etc.
What annoys me is that the EU hamonises the fuck out of everything else in the name of creating a level playing field between member states - why can't it do the same with corporation tax?
My old Belgian boss, who definitely wasn't a left winger, described Luxembourg as the asshole of Europe. Its GDP per head figures are basically bogus, boosted as they are by companies like Amazon (and others as the investigation into Juncker's policies is now revealing). Amazon book all their revenue from countries like the UK and Germany in Luxembourg to avoid tax, but they have hardly any employees there. No wonder GDP per head is so high, but don't expect to find the average Luxembourger, maybe a Starbucks manager, swanning around in a BMW X5.
You are arguing for a race to the bottom. There is a simple one word answer to that argument: Germany. German based companies pay an effective corporate tax rate of just below 30%. I don't know about your house but mine is stuffed full of German products. It's not a conscious choice. Indeed I actively avoided buying German car. I try to buy British I really do. Hi-fi is a small sector where we are still said to excel. Unfortunately my Creek CD player and amp, while playing beautifully, are buggy and the three year old amp needs to be repaired. I don't think that's because of the "high" level of corporation tax.
here is Richard Murphy's definition of "tax avoidance" . (he says that HMRC agree with him on it) I think it is helpful:
"Tax avoidance involves taking steps to secure a tax advantage never intended by Parliament. This means avoiding the intention of the law - hence the name 'tax avoidance'"
He goes on to explain the difference between that and your ISA, pension allowance, etc. Parliament created these opportunities "with the intention that people should reduce their tax bills by right or by reason of undertaking an economic activity that it wanted to encourage".
Anyway, how will ordinary consumers hurt Google? They don't pay to search.
No, but iirc if you click on one of the sponsored links at the top or on the right of the results page, they charge the business concerned extra. So you could stop doing that for starters.
It should be about levelling the playing field, between both multinationals and British-based chains, and large firms and small firms. al
To level the first one, either eliminate corporation tax on British-based chains so they pay the same tax as a multinational, or make multinationals pay a rate based on their global instead of their local profit.
To level the second one, either reduce the amount of taxes a small firm has to pay or increase the amount larger firms have to pay.
Small firms and shops independent of large chains should be encouraged as they generally keep their profits and investment in the community concerned. Large firms are also necessary, however, in order so that they can compete with the large multinationals and they also generally pay more in tax.
The whole system was designed in the last century (and before that). Before the second world war the tax take and provision of public services was much, much smaller. Then we had a big change post second world war. Point is this was 1) before clicks where vat on a purchase can be deemed to be set at the Luxembourg rate of 3% even though the click is in UK, France or Germany. 2) before vast amounts of money can sweep around the globe in a fraction of a second. 3) before the intellectual property aspect of a laptop or even cup of coffee can be charged across to another group company (in a low tax domain) wiping out taxable profits. 4) before hedge funds set up massive loans to utility subsidiaries which in turn use the money to pay dividends and the interest on the loans to offset against profits.
The only organisation big enough to deal with this is the EU with advice from the OECD, political thinkers and political will from the people and the mainstream.
To achieve this the EU will have to establish minimum rates of corporation tax and VAT and maximum transfer pricing percentages on intellectual property. This in order to block a race to the bottom which George Osborne is fronting. I suspect such moves will be fiercely opposed by those on the right and far right claiming this interferes with sovereignty.
Now ask yourself who is footing the bill for the right and far right parties - perhaps it might be those same groups and corporations?!
I suspect EU nation deficits could vaporise overnight if large corporations paid similar rates of taxes to small businesses and individuals. Then countries like Italy, France and others might be able to afford to make the structural changes required and tackle youth unemployment which is running at very dangerous levels - dangerous for social cohesion. For whatever reason the centre left, particularly in the UK has been unable or unwilling to articulate the line that business which has survived the crash and thrived this century should help pay the bills to stabilise and improve things for ordinary working families. Instead there is pro NHS populist rhetoric and an anti bank undercurrent in the background. Unlike other modern industries of tech, media and brands, at least banks pay tax on profits into the government.
This thread juxtaposed with countless comments elsewhere blaming immigrants, foreigners and "someone else" simply underlines the need to get the numbers out in the open.
The tories say we are all in it together then cut the rate of corporation tax for big companies as if there were no deficit. Then attack the EU over immigration when it is the immigrants who are filling skills shortages.
Ironically those working families whose living standards drift down not only have votes but they are customers and can choose where they wish to make their purchases.
We have an election in six months and it might help to have some numbers around this against savings made by freezing benefits for the working poor. Either parties want to work with other nations to collect fair taxes or they don't - you can't do it in isolation.
This is not a war on business - it's simply a statement that a pan European approach on behalf of ALL stakeholders and establish a level playing field between Starbucks and their competitors. We all live in an exciting shopping mall style environment and I fail to see why some tenants are not paying their rent!
From various random conversations and a part time study of some of the elements of the euro crisis plus macro economic challenges, my guess is that we - or our children - have around 20-30 years to find and execute some solutions. Why that time frame? Well it's called demographics - health costs, pension costs, government revenues all need a new approach for this century before European governments are forced into some stark choices.
So we can be selfish and fix UK issues by cutting tax rates but the Eurozone are our customers - Germany has found that if your customers are skint that's not good. This isn't altruistic rhetoric but an appeal to state that UK leaders and thinkers should lead on the way forwards...gently nudging crooks and cheats out of the way as we find a political philosophy fitting for this century and all its associated technology.
The alternatives are quite scary and might just help knock some sense into people...then again?!
I agree with you on all your points. You are absolutely right that this needs to be tackled at an EU level. Luxembourg is finally being exposed - however I heard a Lux minister on the Today prog. hitting back in pretty impressive style, pointing out that his Dutch neighbours might want to remember the proverb about he who casts the first stone.
However if you haven't read it, I recommend Murphy's book because quite early on he points out that the problems actually start with the deficiencies of the US tax system, which also hasn't been revised to take account of the changing world you correctly describe.. Murphy describes how Google is not just avoiding tax in Europe, but in the US as well !
HMRC is not fit for purpose. A lot of people use it as a stepping stone to go into tax and regulation in the private sector, where they are paid so, so much more.
If you pay peanuts, you get monkeys.
When it comes to regulation and taxation, whether you like it or not, in a global economy you need a harmonisation of standards to stop a company funneling billions of pounds through a hairdresser above a corner shop in Luxembourg.
Although the current head of the EU is a bit rich, trying to crackdown on tax in Europe when he was leader of Luxembourg and helped it become a tax haven.
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I also don't consider myself right-wing (I don't support Tories or UKIP), I just happen to be right of the people who call themselves left-wing.
Everyone bitching and crying about it needs to get some perspective. Companies like Starbucks and Google contribute billions of pounds in tax every year by employing people in this country. Their employment costs are huge and where does most of our wedge go? To HMRC. Then they pay 13.8% on top of our salaries as employers NI.
Politicians then go on a witchhunt over peanuts. I'd love one of them to know the answer to how much PAYE these companies cough up each year. Bet they don't and bet it dwarfs the amount of CT tax they have legally avoided.
And you assert that the £6.75 BILLION that HMRC forgave Vodafone is "peanuts"? Wow.
If people just said no to these companies and refused to use their services until they pay the correct taxes the companies would have little choice, as long as you are happy to support them to save a few quid nothing will change.
Sadly I don't have any faith in the government of our, or any country doing anything about it. The threats of withdrawal and self preservation will see to that.
This is something the public can do something about, these places can only charge the prices they do because of the savings they make elsewhere, if Vodaphone paid the full amount of tax you believe they should their prices would go up, of that I'm sure. If you care enough, don't support it.
The fact is that employees pay PAYE Income Tax and Employee National Insurance on standard salary payments. Employers collect these taxes from their employees from salary due to be paid on payday, but the burden for these is not on employers.
If the government increased the rates of tax tomorrow (say, from 20p to 30p), that wouldn't affect the cost to my employers. It would hit me directly in my pocket in the form of a lower net pay, but the gross pay (ie cost to employer) would remain the same.
In industries with high mobility of workforce, such as financial services or oil/gas, sure there would be a burden on employers, as they would have to replace employees who leave to work in New York or Dubai etc, and it's likely they would have to offer higher wages to offset the tax rise. However, coffee baristas (Starbucks) and warehouse workers (Amazon) do not work in industries with high mobility of labour.
Similarly, VAT is ultimately paid by customers, but collected on behalf of HMRC by sellers. I would be very concerned if I encountered a medium to large business (anything bigger than a corner shop) that considered VAT to be part of its revenues - in every case I've encountered in working life, VAT was something added on after the final price (for both sales and purchases).
Of course, Employers' NI is a burden on employers.
Anyway, if the whole focus was to be on PAYE income tax and National Insurance as the main sources of tax revenue, then surely the government should be encouraging labour intensive companies (such as bookshops) rather than technology-driven companies (like Amazon).
I bought a couple of CDs for a buddy earlier this week. I tried to buy them from Play.com so as to avoid Amazon. They only had one of the two CDs (even though they are from the same band and both less than two years old). But even if I had been able to use Play.com, how do I know they aren't up to the same tricks? If I don't use Amazon and my Kindle, the alternative is iBooks. I'm sure bloody Apple are up to it too.
I understand that you don't have faith in politicians but this is what they are here for. And if you don't have faith in them, well, like Russell Brand, you know what you must do...:-)
But if I am right, and it is an analogy, I take it to mean that you think those directors are making their decisions in a philanthropic way, and not with profit and only profit in mind and nothing else, which is how it appears to me. So it stands to reason that some sections of the media are going to feel the same, and therefore report it how they see it. The right wing press more or less ignore it and blame all the problems on immigrants and benefit claimants. Therefore when knocking the section of the media and the contributors to this thread pointing out a left wing point of view, you are going to appear right wing, even if you are not. If that makes sense?
Hope I have explained myself properly, and not come across as having a dig, as that's not what I mean to do ( apart from the tongue-in-cheek first para ).
Businesses come to the UK because it's a good business environment, they go to Luxembourg because they save tax. Luxembourg's GDP per capita is above £100k I think compered to our £25k? It is the easements which are needed in complex tax system like ours that create the loopholes in the system that are exploited. A lower tax regime clearly boosts Luxembourg's wealth, so isn't there a case for arguing that a lower UK tax regime will yield more tax than a punitive one? That our attraction for inward investment from abroad will increase even more?
That more jobs will be created? That more wealth will be created?
Thinking that the multinational virtual businesses, who can choose where to pay tax, can be brought to heel with ever more esoteric tax rules that will be bomb-proof is wishful thinking, like most attempts to raise revenue with aggressive taxation. I heard Ken Livingstone on radio suggest the solution is to tax turnover. Can't think of a more ludicrous idea. It is an example of the crass idea that slapping a tax on something will increase the public coffers and the public will not be the ones to suffer the ultimate cost, it's a sum zero game.
The alternative suggestion for debating is to make Amazon and Starbucks want to pay tax in the UK by reducing taxation. Will not happen because it's not "fair", which carries far more weight and more votes than common sense.
However, this post was quite helpful. Basically, and correct me if I am wrong, what I think you are saying is that perhaps we should encourage a lower rate of corporate tax that applies to everybody, therefore removing all the complexities and loopholes of the current tax system. This way we encourage businesses to set up shop over here, create jobs, get a more consistent level of payments from corporations, do not have to spend 1000s of man hours, time & money fighting these companies and pressing hard on smaller businesses to make up for the shortfall.
It's true that Amazon and Starbucks do emply people here. Most of teh jobs are low wage of course, so the taxpaer subsidises them by paying family credit etc.
What annoys me is that the EU hamonises the fuck out of everything else in the name of creating a level playing field between member states - why can't it do the same with corporation tax?
My old Belgian boss, who definitely wasn't a left winger, described Luxembourg as the asshole of Europe. Its GDP per head figures are basically bogus, boosted as they are by companies like Amazon (and others as the investigation into Juncker's policies is now revealing). Amazon book all their revenue from countries like the UK and Germany in Luxembourg to avoid tax, but they have hardly any employees there. No wonder GDP per head is so high, but don't expect to find the average Luxembourger, maybe a Starbucks manager, swanning around in a BMW X5.
You are arguing for a race to the bottom. There is a simple one word answer to that argument: Germany. German based companies pay an effective corporate tax rate of just below 30%. I don't know about your house but mine is stuffed full of German products. It's not a conscious choice. Indeed I actively avoided buying German car. I try to buy British I really do. Hi-fi is a small sector where we are still said to excel. Unfortunately my Creek CD player and amp, while playing beautifully, are buggy and the three year old amp needs to be repaired. I don't think that's because of the "high" level of corporation tax.
"Tax avoidance involves taking steps to secure a tax advantage never intended by Parliament. This means avoiding the intention of the law - hence the name 'tax avoidance'"
He goes on to explain the difference between that and your ISA, pension allowance, etc. Parliament created these opportunities "with the intention that people should reduce their tax bills by right or by reason of undertaking an economic activity that it wanted to encourage".
To level the first one, either eliminate corporation tax on British-based chains so they pay the same tax as a multinational, or make multinationals pay a rate based on their global instead of their local profit.
To level the second one, either reduce the amount of taxes a small firm has to pay or increase the amount larger firms have to pay.
Small firms and shops independent of large chains should be encouraged as they generally keep their profits and investment in the community concerned. Large firms are also necessary, however, in order so that they can compete with the large multinationals and they also generally pay more in tax.
Point is this was
1) before clicks where vat on a purchase can be deemed to be set at the Luxembourg rate of 3% even though the click is in UK, France or Germany.
2) before vast amounts of money can sweep around the globe in a fraction of a second.
3) before the intellectual property aspect of a laptop or even cup of coffee can be charged across to another group company (in a low tax domain) wiping out taxable profits.
4) before hedge funds set up massive loans to utility subsidiaries which in turn use the money to pay dividends and the interest on the loans to offset against profits.
The only organisation big enough to deal with this is the EU with advice from the OECD, political thinkers and political will from the people and the mainstream.
To achieve this the EU will have to establish minimum rates of corporation tax and VAT and maximum transfer pricing percentages on intellectual property. This in order to block a race to the bottom which George Osborne is fronting. I suspect such moves will be fiercely opposed by those on the right and far right claiming this interferes with sovereignty.
Now ask yourself who is footing the bill for the right and far right parties - perhaps it might be those same groups and corporations?!
I suspect EU nation deficits could vaporise overnight if large corporations paid similar rates of taxes to small businesses and individuals. Then countries like Italy, France and others might be able to afford to make the structural changes required and tackle youth unemployment which is running at very dangerous levels - dangerous for social cohesion.
For whatever reason the centre left, particularly in the UK has been unable or unwilling to articulate the line that business which has survived the crash and thrived this century should help pay the bills to stabilise and improve things for ordinary working families. Instead there is pro NHS populist rhetoric and an anti bank undercurrent in the background. Unlike other modern industries of tech, media and brands, at least banks pay tax on profits into the government.
This thread juxtaposed with countless comments elsewhere blaming immigrants, foreigners and "someone else" simply underlines the need to get the numbers out in the open.
The tories say we are all in it together then cut the rate of corporation tax for big companies as if there were no deficit. Then attack the EU over immigration when it is the immigrants who are filling skills shortages.
Ironically those working families whose living standards drift down not only have votes but they are customers and can choose where they wish to make their purchases.
We have an election in six months and it might help to have some numbers around this against savings made by freezing benefits for the working poor. Either parties want to work with other nations to collect fair taxes or they don't - you can't do it in isolation.
This is not a war on business - it's simply a statement that a pan European approach on behalf of ALL stakeholders and establish a level playing field between Starbucks and their competitors. We all live in an exciting shopping mall style environment and I fail to see why some tenants are not paying their rent!
From various random conversations and a part time study of some of the elements of the euro crisis plus macro economic challenges, my guess is that we - or our children - have around 20-30 years to find and execute some solutions. Why that time frame? Well it's called demographics - health costs, pension costs, government revenues all need a new approach for this century before European governments are forced into some stark choices.
So we can be selfish and fix UK issues by cutting tax rates but the Eurozone are our customers - Germany has found that if your customers are skint that's not good. This isn't altruistic rhetoric but an appeal to state that UK leaders and thinkers should lead on the way forwards...gently nudging crooks and cheats out of the way as we find a political philosophy fitting for this century and all its associated technology.
The alternatives are quite scary and might just help knock some sense into people...then again?!
I agree with you on all your points. You are absolutely right that this needs to be tackled at an EU level. Luxembourg is finally being exposed - however I heard a Lux minister on the Today prog. hitting back in pretty impressive style, pointing out that his Dutch neighbours might want to remember the proverb about he who casts the first stone.
However if you haven't read it, I recommend Murphy's book because quite early on he points out that the problems actually start with the deficiencies of the US tax system, which also hasn't been revised to take account of the changing world you correctly describe.. Murphy describes how Google is not just avoiding tax in Europe, but in the US as well !
If you pay peanuts, you get monkeys.
When it comes to regulation and taxation, whether you like it or not, in a global economy you need a harmonisation of standards to stop a company funneling billions of pounds through a hairdresser above a corner shop in Luxembourg.
Although the current head of the EU is a bit rich, trying to crackdown on tax in Europe when he was leader of Luxembourg and helped it become a tax haven.
.......maybe