Those who still believe that culture doesn't matter and that companies have an immutable legal (fiduciary) duty to their shareholders to minimise the tax they pay, lawfully, might want to reflect on this article about Barclays decision to close its controversial 'tax avoidance' unit.
I won't bother to summarise the article except to say that the unit was very profitable and wasn't doing anything illegal. It was closed because Barclays wished to align their business with the values of society and not simply the letter of the law. That's what I call "culture".
I don't believe anybody has argued that Barclays is in breach of its duty to shareholders. As far as its customers are concerned I'd bet that many of them are no longer engaging in the lawful schemes Barclays previously recommended, but I'd be surprised if their shareholders are accusing them of a breach of fiduciary duty.
The views of society matter. Its not just about the letter of the law. Barclays former CEO, Bob Diamond, under whom that unit became very profitable, was ousted not because he was doing anything illegal or because his Board felt he wasn't doing a good job, but, allegedly, because the relevant Government institution, representing society, felt that his behaviour, the culture he represented, was too aggressive and, ultimately, unacceptable. That's cultural change and it matters.
Mundell argues for principle based legislation rather than literal interpretation and indeed that is a current trend in political thinking and in the tax courts. The problem as I see it is whose principles are to be adopted? It's ok as long as they are aligned with your own, but remember there are plenty of people around who think it's ok to fart in a lift.
Taxation may be essential but so is the tenet that taxation should be clear and certain. In our country it is far from so and yes that is Parliament's fault so I think Dippenhall is quite right in arguing that the defeating of Parliamentary intention is not an adequate way to define tax avoidance.
How about this for a principle to be adopted:
If the reasonable man ( a cornerstone of our legal system) finds that a company's explanation of the application of its revenue and cost bases to taxable units of that company is not rational and credible, that is tax avoidance. In other words if the basis of a company's claimed tax liability is built on, for want of a better word, a lie, HMRC should be all over them and you don't need to change the laws to get them, you just need HMRC to be competent and to inform itself. It should for example talk to, or if necessary hire on a consultancy basis, leading managers from the relevant industry to help them understand the industry.
I argue that some companies are getting away with tax avoidance simply because HMRC has not informed itself and prepared the relevant legal case. You were really struggling with my explanation of how Google makes its money, but its no struggle for people who work in the advertising industry. Google's public explanation of where their business is carried out is a big porky. If a company needs porkies in order to be taxed at an unfeasibly low level compared to its earnings, it's a tax avoider. And is no different to the self employed salesman who has, in the opinion of HMRC been making unbelievable claims regarding his business travel expenses (a mate of mine was pursued for months by a muppet from HMRC armed with a DVD map of the UK)
If it looks like a duck, etc
I can't agree that telling porkies leads to tax avoidance. That is tax evasion you are thinking of. Illegal and properly punishable if the authorities have their act together.
I think you are arguing forcefully that Google are engaged in tax evasion and that HMRC is either turning a blind eye or too incompetent to see it. But lying to the tax authorities is not a tool of tax avoidance.
I'm deleting that post; apologies for the abort but, on reflection, I don't want to keep arguing on a matter where we just won't persuade one another. Sincerely wish you all a very Merry Christmas.
Those who still believe that culture doesn't matter and that companies have an immutable legal (fiduciary) duty to their shareholders to minimise the tax they pay, lawfully, might want to reflect on this article about Barclays decision to close its controversial 'tax avoidance' unit.
I won't bother to summarise the article except to say that the unit was very profitable and wasn't doing anything illegal. It was closed because Barclays wished to align their business with the values of society and not simply the letter of the law. That's what I call "culture".
I don't believe anybody has argued that Barclays is in breach of its duty to shareholders. As far as its customers are concerned I'd bet that many of them are no longer engaging in the lawful schemes Barclays previously recommended, but I'd be surprised if their shareholders are accusing them of a breach of fiduciary duty.
The views of society matter. Its not just about the letter of the law. Barclays former CEO, Bob Diamond, under whom that unit became very profitable, was ousted not because he was doing anything illegal or because his Board felt he wasn't doing a good job, but, allegedly, because the relevant Government institution, representing society, felt that his behaviour, the culture he represented, was too aggressive and, ultimately, unacceptable. That's cultural change and it matters.
We'll have to agree to disagree (somewhat) about Barclays as well Mundell. Bob Diamond's resignation was the result not of the then-management feeling "he wasn't doing a good job" but specifically as a result of the Libor-rigging scandal. Conspiracy to manipulate Libor-fixings by bank employees was fraud and thus illegal - not that Diamond was involved personally but he was in ultimate charge of the bank at the time and forced to take responsibility; the bank being leant on by the Bank of England (some would say inappropriately). In any event, that had NOTHING to do whatsoever with Barclays' tax unit, which has been disbanded by the new management, which has indeed decided to make the bank a model of political correctness. That decision is not universally acclaimed by current and former shareholders of the bank, since the tax unit has never been accused of anything illegal but was highly successful in a business that has become an aunt sally for the public's misdirected vengeance for the sub-prime debacle and ensuing Crash.
I agree re the background to Bob Diamond's departure from Barclays and I didn't mean to imply that the tax unit was directly involved. I suspect we also agree that Barclays, as well as other Banks, continues to make a major effort to demonstrate that they are addressing the perceived behavioural and cultural weaknesses which Bob Diamond was seen by the Bank of England and others as being responsible for.
Where I think we are still agreeing to disagree is whether this change in their management's focus is appropriate. And that's fair enough. Whoever is right or wrong though, if indeed there is a clear right or wrong, I'm sure we also agree that this debate, which is, in part, a fall-out from the Financial Crisis, isn't likely to end any time soon. We're in a new paradigm.
Those who still believe that culture doesn't matter and that companies have an immutable legal (fiduciary) duty to their shareholders to minimise the tax they pay, lawfully, might want to reflect on this article about Barclays decision to close its controversial 'tax avoidance' unit.
I won't bother to summarise the article except to say that the unit was very profitable and wasn't doing anything illegal. It was closed because Barclays wished to align their business with the values of society and not simply the letter of the law. That's what I call "culture".
I don't believe anybody has argued that Barclays is in breach of its duty to shareholders. As far as its customers are concerned I'd bet that many of them are no longer engaging in the lawful schemes Barclays previously recommended, but I'd be surprised if their shareholders are accusing them of a breach of fiduciary duty.
The views of society matter. Its not just about the letter of the law. Barclays former CEO, Bob Diamond, under whom that unit became very profitable, was ousted not because he was doing anything illegal or because his Board felt he wasn't doing a good job, but, allegedly, because the relevant Government institution, representing society, felt that his behaviour, the culture he represented, was too aggressive and, ultimately, unacceptable. That's cultural change and it matters.
We'll have to agree to disagree (somewhat) about Barclays as well Mundell. Bob Diamond's resignation was the result not of the then-management feeling "he wasn't doing a good job" but specifically as a result of the Libor-rigging scandal. Conspiracy to manipulate Libor-fixings by bank employees was fraud and thus illegal - not that Diamond was involved personally but he was in ultimate charge of the bank at the time and forced to take responsibility; the bank being leant on by the Bank of England (some would say inappropriately). In any event, that had NOTHING to do whatsoever with Barclays' tax unit, which has been disbanded by the new management, which has indeed decided to make the bank a model of political correctness. That decision is not universally acclaimed by current and former shareholders of the bank, since the tax unit has never been accused of anything illegal but was highly successful in a business that has become an aunt sally for the public's misdirected vengeance for the sub-prime debacle and ensuing Crash.
I agree re the background to Bob Diamond's departure from Barclays and I didn't mean to imply that the tax unit was directly involved. I suspect we also agree that Barclays, as well as other Banks, continues to make a major effort to demonstrate that they are addressing the perceived behavioural and cultural weaknesses which Bob Diamond was seen by the Bank of England and others as being responsible for.
Where I think we are still agreeing to disagree is whether this change in their management's focus is appropriate. And that's fair enough. Whoever is right or wrong though, if indeed there is a clear right or wrong, I'm sure we also agree that this debate, which is, in part, a fall-out from the Financial Crisis, isn't likely to end any time soon. We're in a new paradigm.
@PragueAddick I believe the root of all evil goes back to this particular case. Granted Corporations the same rights as Individuals and slowly crept over into Europe.
@PragueAddick I believe the root of all evil goes back to this particular case. Granted Corporations the same rights as Individuals and slowly crept over into Europe.
Cabbles, I don't think you can blame the Yanks for that. In English law Companies Act of 1862 predates that decision and set out the doctrine of corporate personality and limited liability.
@PragueAddick I believe the root of all evil goes back to this particular case. Granted Corporations the same rights as Individuals and slowly crept over into Europe.
Cabbles, I don't think you can blame the Yanks for that. In English law Companies Act of 1862 predates that decision and set out the doctrine of corporate personality and limited liability.
I only read that the other day and thought of Prague. Remember @Jints that I couldn't get a training contract! Obviously my research skills weren't up to scratch I'd have failed massively if I'd have come up with that one.....
@PragueAddick I believe the root of all evil goes back to this particular case. Granted Corporations the same rights as Individuals and slowly crept over into Europe.
Cabbles, I don't think you can blame the Yanks for that. In English law Companies Act of 1862 predates that decision and set out the doctrine of corporate personality and limited liability.
I only read that the other day and thought of Prague. Remember @Jints that I couldn't get a training contract! Obviously my research skills weren't up to scratch I'd have failed massively if I'd have come up with that one.....
Thanks, I'll take a look. I've been meaning to return to this thread because of course over the holiday I finished the Richard Murphy book. But @AFKABartram is already concerned about my health :-), and I've got some work to do, so I will have to return to this later but I'm definitely interested to continue discussing all aspects of this topic.
here's something to throw in to the mix. Is Roland Duchatelet a tax avoider? As far as I can tell, he is not. He has no suspicious locations for his company seats, be it the footie one or the main ones. And it would have been so easy for him to do so. He lives a short drive from Luxembourg. Yet politically, he has demonstrated some strong views on tax, and how it is deployed. An interesting man, it has to be said. What a pity he is so reluctant to share his views more freely.
@PragueAddick I believe the root of all evil goes back to this particular case. Granted Corporations the same rights as Individuals and slowly crept over into Europe.
Cabbles, I don't think you can blame the Yanks for that. In English law Companies Act of 1862 predates that decision and set out the doctrine of corporate personality and limited liability.
I only read that the other day and thought of Prague. Remember @Jints that I couldn't get a training contract! Obviously my research skills weren't up to scratch I'd have failed massively if I'd have come up with that one.....
Don't worry - I just happened to have spent a lot of time over the years on this particular area of law (despite my speciality not being company law at all). A few years ago, my client wanted to run a test case all the way to the Supreme Court (if necessary) - but the other side chickened out the day before the hearing of the first level court...
The leading case in English Law is Salomon v Salomon (1897)
Even before then the legal concept of corporations (back in the day when companies coudl only be established by Acts of Parliament) as legal personalities was pretty well established. One18th Century Lord Chancellor asked, well in advance of late capitalistic tax didging:
"did you ever expect a corporation to have a conscience, when it has no soul to be damned and no body to be kicked?"
@PragueAddick I believe the root of all evil goes back to this particular case. Granted Corporations the same rights as Individuals and slowly crept over into Europe.
Cabbles, I don't think you can blame the Yanks for that. In English law Companies Act of 1862 predates that decision and set out the doctrine of corporate personality and limited liability.
I only read that the other day and thought of Prague. Remember @Jints that I couldn't get a training contract! Obviously my research skills weren't up to scratch I'd have failed massively if I'd have come up with that one.....
Thanks, I'll take a look. I've been meaning to return to this thread because of course over the holiday I finished the Richard Murphy book. But @AFKABartram is already concerned about my health :-), and I've got some work to do, so I will have to return to this later but I'm definitely interested to continue discussing all aspects of this topic.
here's something to throw in to the mix. Is Roland Duchatelet a tax avoider? As far as I can tell, he is not. He has no suspicious locations for his company seats, be it the footie one or the main ones. And it would have been so easy for him to do so. He lives a short drive from Luxembourg. Yet politically, he has demonstrated some strong views on tax, and how it is deployed. An interesting man, it has to be said. What a pity he is so reluctant to share his views more freely.
Prague, if he did share his views he knows you would use it to start an argument on CL, so he protects us by keeping his own counsel. :-)
@PragueAddick I believe the root of all evil goes back to this particular case. Granted Corporations the same rights as Individuals and slowly crept over into Europe.
Cabbles, I don't think you can blame the Yanks for that. In English law Companies Act of 1862 predates that decision and set out the doctrine of corporate personality and limited liability.
I only read that the other day and thought of Prague. Remember @Jints that I couldn't get a training contract! Obviously my research skills weren't up to scratch I'd have failed massively if I'd have come up with that one.....
Don't worry - I just happened to have spent a lot of time over the years on this particular area of law (despite my speciality not being company law at all). A few years ago, my client wanted to run a test case all the way to the Supreme Court (if necessary) - but the other side chickened out the day before the hearing of the first level court...
The leading case in English Law is Salomon v Salomon (1897)
Even before then the legal concept of corporations (back in the day when companies coudl only be established by Acts of Parliament) as legal personalities was pretty well established. One18th Century Lord Chancellor asked, well in advance of late capitalistic tax didging:
"did you ever expect a corporation to have a conscience, when it has no soul to be damned and no body to be kicked?"
Good quote - god knows what other legislation corporations have moulded in their favour
@PragueAddick I believe the root of all evil goes back to this particular case. Granted Corporations the same rights as Individuals and slowly crept over into Europe.
Cabbles, I don't think you can blame the Yanks for that. In English law Companies Act of 1862 predates that decision and set out the doctrine of corporate personality and limited liability.
I only read that the other day and thought of Prague. Remember @Jints that I couldn't get a training contract! Obviously my research skills weren't up to scratch I'd have failed massively if I'd have come up with that one.....
Don't worry - I just happened to have spent a lot of time over the years on this particular area of law (despite my speciality not being company law at all). A few years ago, my client wanted to run a test case all the way to the Supreme Court (if necessary) - but the other side chickened out the day before the hearing of the first level court...
The leading case in English Law is Salomon v Salomon (1897)
Even before then the legal concept of corporations (back in the day when companies coudl only be established by Acts of Parliament) as legal personalities was pretty well established. One18th Century Lord Chancellor asked, well in advance of late capitalistic tax didging:
"did you ever expect a corporation to have a conscience, when it has no soul to be damned and no body to be kicked?"
Good quote - god knows what other legislation corporations have moulded in their favour
Some people would have you believe, almost all of them.
So Russian emigre oligarchs among others, are funding the Tories. But they don't have a vote!. Oh wait, they don't need a vote, they just bung some money, and everything's sorted. Another way in which Putin exercises more influence over British policies than you or I ever can.
Simple, we all pay part of our taxes to a nominated party. When we vote we are voting to contribute to that party. If the big parties are spending around £12m it would only amount to a few pence a week for every worker to cover the costs of three or four parties.
Risk is that the hurdle to creating Monster Raving Looney parties is so low that we end up with an array of useless parties that undermines the whole system and we have elections and revolving coalition parties worse than in Italy.
Worth remembering that our parliamentary democracy was never envisaged as a means of everyday folk running the country. Until relatively recently you only got a vote if you owned a substantial landholding. The Magna Carta as I am sure we will hear this year on its 800 anniversary, was designed to give power to the land barons to control the monarch and make him subject to the law of the land. Democracy as we understand it was not on the agenda and would have been heresy.
So agree we do need a peaceful revolution so that parliament gets disengaged from the landowning democracy model and into the modern age of universal suffrage.
I agree with Mr Murphy that HMRC too often prefer to secure revenue through deals rather than seeking jail sentences.
But the connection with TV licenses in mendacious because (1) you can't go to prison for not having a TV license. You can be fined by the court and you can go to prison, exceptionally, for not paying the court fine i.e. for being in contempt of court and (2) HMRC do not prosecute for license fee evasions. That's the BBC,
Well if you can't stomach reading the Guardian's coverage of the latest exposure of tax dodging, there is always tonight's Panorama.
As Richard Murphy says:
Last year more than 200,000 people were prosecuted for not having a TV licence.
More than fifty – many of them women – went to prison for it.
But HMRC say it is not in the public interest to prosecute tax criminals and the bankers and accountants who set arrangements for them.
How can that be?
Which minister wants to explain how we go to this absurd position?
HMRC. NFFP….
I'm no great fan of HMRC - they are in the main pretty dumb. But they do not like criminal prosecutions because the burden of proof is high (remember Harry Redknapp) and the financial transactions are likely to be complex - perhaps too complex for the average Jury. So they take civil proceedings instead. Much more successful in getting hold of the dosh as the burden of proof is lower.
Now, obviously posting before seeing the Panorama programme...
BUT... as far as has been leaked so far x number of people have accounts in Switzerland with HSBC. So what? Now, in the main Swiss bank accounts do not pay much interest (in fact negative rates are not unknown). So what's is being avoided? There won't be much tax due on non-existent interest will there? And there's no tax due on assets until such time as they are sold for a profit and capital gains tax becomes due.
What does that leave? The BBC reports on its own story make it sound as if merely holding the money in another country is wrong. Clearly, that's not the case. So, what does that leave? Probably only the removal of capital/income from the UK after an asset, eg a business has been sold for a profit with the intention of not paying the CGT due at the time or income has been acquired upon which no tax has been paid. So, whatever, the overseas banking entity is doing, what is HMRC doing that means it is not identifying large sums of money going overseas from the UK? Bear in mind that the "nominated officer's" role in the UK-based bank through which the money will have been channelled will have a responsibility to report the "suspicious activity" under the money laundering regs.
ANY transactions (for an existing customer) that:
are different from the normal business of the customer; or where the size and frequency of the transaction is different from the customer’s normal pattern; or where the pattern has changed since the business relationship was established; or there has been a significant or unexpected improvement in the customer’s financial position; or where the customer can't give a proper explanation of where money came from.
would (are supposed to) trigger an automatic ML referral. (Last time I had anything to do with such stuff any unexplained transfer in excess of £10k would be reported.) So what do the authorities do with these data? Nothing much it seems.
As for the odious Margaret Hodge well just Google her + children's homes + Islington and wonder why/how she is still in politics.
Well if you can't stomach reading the Guardian's coverage of the latest exposure of tax dodging, there is always tonight's Panorama.
As Richard Murphy says:
Last year more than 200,000 people were prosecuted for not having a TV licence.
More than fifty – many of them women – went to prison for it.
But HMRC say it is not in the public interest to prosecute tax criminals and the bankers and accountants who set arrangements for them.
How can that be?
Which minister wants to explain how we go to this absurd position?
HMRC. NFFP….
1) Why was it necessary for the writer to highlight that some of those that had been imprisoned for licence fee evasion were women?
2) Bit rich for either the Guardian or Hodge the Dodge to be banging on about tax avoidance given they have both been exposed as being party to tax fiddles themselves.
@ cafcfan. Well let's see what the accusations are in detail. I haven't had time to read the Guardian in detail, not least because its new site keeps crashing on my iPad. However I hear right now on PM that HSBC Is saying that it has changed its ways. So they concede there is a case to answer.
It's all very well playing what aboutery with Margaret Hodge, but this is why I chose the thread title. WHICH politicians are serious about addressing our deficit the obvious way, by boosting the revenue side through competent adherence to the existing tax laws?
@ cafcfan. I hear right now on PM that HSBC Is saying that it has changed its ways. So they concede there is a case to answer......
That doesn't follow Prague and is a little unfair. They may (almost certainly have, in fact) decided that there is so much grief to be had from the baying mob of media and politicians that it's not worth their while to maintain what had been a perfectly legal tax advisory business which may have enabled clients to avoid (but not evade) tax. I'm not saying that, in this Swiss case, it was perfectly legal (I don't know) but saying that they've changed their ways is not a tacit admission of guilt or even that there is a case to answer to the UK authorities.
EDIT - Oh bugger - I didn't mean to post again on this thread. I'll sod off now
@ cafcfan. I hear right now on PM that HSBC Is saying that it has changed its ways. So they concede there is a case to answer......
That doesn't follow Prague and is a little unfair. They may (almost certainly have, in fact) decided that there is so much grief to be had from the baying mob of media and politicians that it's not worth their while to maintain what had been a perfectly legal tax advisory business which may have enabled clients to avoid (but not evade) tax. I'm not saying that, in this Swiss case, it was perfectly legal (I don't know) but saying that they've changed their ways is not a tacit admission of guilt or even that there is a case to answer to the UK authorities.
EDIT - Oh bugger - I didn't mean to post again on this thread. I'll sod off now
Well they appear to concede that there is a case to answer that their managerial oversight was not what would be expected of a global publicly quoted company of their status. That may not amount to a legal case to answer but it is quite bad enough, in my book at least.
HSBC’s response to the Swiss shenanigans is wearingly familiar. It is similar to the line the bank took after its operations in Mexico and Colombia were exposed in 2012 as being wide open to money laundering. We were told then that HSBC’s federated corporate structure was partly to blame. It prevented group management getting to grips with tricky local details, such as spotting those customers who were running multibillion-dollar drug cartels.
In a Swiss context the corporate plea is cast this way: “HSBC was run in a more federated way than it is today and decisions were frequently taken at a country level. In January 2011, new group management fundamentally changed the way HSBC is structured, managed and controlled.”
For me tax is the fee you pay for being part of our society. Don't pay what you should then you shouldn't be allowed to be part of that society eg not protected by its laws or looked after by its health system etc.
Well if you can't stomach reading the Guardian's coverage of the latest exposure of tax dodging, there is always tonight's Panorama.
As Richard Murphy says:
Last year more than 200,000 people were prosecuted for not having a TV licence.
More than fifty – many of them women – went to prison for it.
BTW, this is disingenuous. The only sanction the legislation provides and is available to a Magistrate is to fine someone for using a TV while not having a licence.
The individuals that Murphy refers to will presumably have been sent to prison by the Mags for non-payment of a fine. An entirely different matter.
It is also clear that in the same way that it's much easier to catch a speeding motorist, it is much easier to catch a TV licence cheat than someone who is evading tax.
Comments
I won't bother to summarise the article except to say that the unit was very profitable and wasn't doing anything illegal. It was closed because Barclays wished to align their business with the values of society and not simply the letter of the law. That's what I call "culture".
I don't believe anybody has argued that Barclays is in breach of its duty to shareholders. As far as its customers are concerned I'd bet that many of them are no longer engaging in the lawful schemes Barclays previously recommended, but I'd be surprised if their shareholders are accusing them of a breach of fiduciary duty.
The views of society matter. Its not just about the letter of the law. Barclays former CEO, Bob Diamond, under whom that unit became very profitable, was ousted not because he was doing anything illegal or because his Board felt he wasn't doing a good job, but, allegedly, because the relevant Government institution, representing society, felt that his behaviour, the culture he represented, was too aggressive and, ultimately, unacceptable. That's cultural change and it matters.
I think you are arguing forcefully that Google are engaged in tax evasion and that HMRC is either turning a blind eye or too incompetent to see it. But lying to the tax authorities is not a tool of tax avoidance.
Sincerely wish you all a very Merry Christmas.
Where I think we are still agreeing to disagree is whether this change in their management's focus is appropriate. And that's fair enough. Whoever is right or wrong though, if indeed there is a clear right or wrong, I'm sure we also agree that this debate, which is, in part, a fall-out from the Financial Crisis, isn't likely to end any time soon. We're in a new paradigm.
Have a good one MF.
http://en.wikipedia.org/wiki/Santa_Clara_County_v._Southern_Pacific_Railroad
here's something to throw in to the mix. Is Roland Duchatelet a tax avoider? As far as I can tell, he is not. He has no suspicious locations for his company seats, be it the footie one or the main ones. And it would have been so easy for him to do so. He lives a short drive from Luxembourg. Yet politically, he has demonstrated some strong views on tax, and how it is deployed. An interesting man, it has to be said. What a pity he is so reluctant to share his views more freely.
The leading case in English Law is Salomon v Salomon (1897)
http://en.wikipedia.org/wiki/Salomon_v_A_Salomon_&_Co_Ltd
Even before then the legal concept of corporations (back in the day when companies coudl only be established by Acts of Parliament) as legal personalities was pretty well established. One18th Century Lord Chancellor asked, well in advance of late capitalistic tax didging:
"did you ever expect a corporation to have a conscience, when it has no soul to be damned and no body to be kicked?"
Persuasive for me, that.
So Russian emigre oligarchs among others, are funding the Tories. But they don't have a vote!. Oh wait, they don't need a vote, they just bung some money, and everything's sorted. Another way in which Putin exercises more influence over British policies than you or I ever can.
It's a very powerful video indeed, and a most disheartening one. Things MUST change.
Risk is that the hurdle to creating Monster Raving Looney parties is so low that we end up with an array of useless parties that undermines the whole system and we have elections and revolving coalition parties worse than in Italy.
Worth remembering that our parliamentary democracy was never envisaged as a means of everyday folk running the country. Until relatively recently you only got a vote if you owned a substantial landholding. The Magna Carta as I am sure we will hear this year on its 800 anniversary, was designed to give power to the land barons to control the monarch and make him subject to the law of the land. Democracy as we understand it was not on the agenda and would have been heresy.
So agree we do need a peaceful revolution so that parliament gets disengaged from the landowning democracy model and into the modern age of universal suffrage.
As Richard Murphy says:
Last year more than 200,000 people were prosecuted for not having a TV licence.
More than fifty – many of them women – went to prison for it.
But HMRC say it is not in the public interest to prosecute tax criminals and the bankers and accountants who set arrangements for them.
How can that be?
Which minister wants to explain how we go to this absurd position?
HMRC. NFFP….
But the connection with TV licenses in mendacious because (1) you can't go to prison for not having a TV license. You can be fined by the court and you can go to prison, exceptionally, for not paying the court fine i.e. for being in contempt of court and (2) HMRC do not prosecute for license fee evasions. That's the BBC,
Now, obviously posting before seeing the Panorama programme...
BUT... as far as has been leaked so far x number of people have accounts in Switzerland with HSBC. So what?
Now, in the main Swiss bank accounts do not pay much interest (in fact negative rates are not unknown). So what's is being avoided? There won't be much tax due on non-existent interest will there? And there's no tax due on assets until such time as they are sold for a profit and capital gains tax becomes due.
What does that leave? The BBC reports on its own story make it sound as if merely holding the money in another country is wrong. Clearly, that's not the case. So, what does that leave? Probably only the removal of capital/income from the UK after an asset, eg a business has been sold for a profit with the intention of not paying the CGT due at the time or income has been acquired upon which no tax has been paid.
So, whatever, the overseas banking entity is doing, what is HMRC doing that means it is not identifying large sums of money going overseas from the UK? Bear in mind that the "nominated officer's" role in the UK-based bank through which the money will have been channelled will have a responsibility to report the "suspicious activity" under the money laundering regs.
ANY transactions (for an existing customer) that:
are different from the normal business of the customer;
or where the size and frequency of the transaction is different from the
customer’s normal pattern;
or where the pattern has changed since the business relationship was
established;
or there has been a significant or unexpected improvement in the
customer’s financial position;
or where the customer can't give a proper explanation of where money came
from.
would (are supposed to) trigger an automatic ML referral. (Last time I had anything to do with such stuff any unexplained transfer in excess of £10k would be reported.) So what do the authorities do with these data? Nothing much it seems.
As for the odious Margaret Hodge well just Google her + children's homes + Islington and wonder why/how she is still in politics.
2) Bit rich for either the Guardian or Hodge the Dodge to be banging on about tax avoidance given they have both been exposed as being party to tax fiddles themselves.
Well let's see what the accusations are in detail. I haven't had time to read the Guardian in detail, not least because its new site keeps crashing on my iPad. However I hear right now on PM that HSBC Is saying that it has changed its ways. So they concede there is a case to answer.
It's all very well playing what aboutery with Margaret Hodge, but this is why I chose the thread title. WHICH politicians are serious about addressing our deficit the obvious way, by boosting the revenue side through competent adherence to the existing tax laws?
I'm not saying that, in this Swiss case, it was perfectly legal (I don't know) but saying that they've changed their ways is not a tacit admission of guilt or even that there is a case to answer to the UK authorities.
EDIT - Oh bugger - I didn't mean to post again on this thread. I'll sod off now
BBC reporting on excessive prosecution of cases brought to court by... the BBC ?
Another reason why the TV tax should be scrapped and taken from general taxation...
HSBC’s response to the Swiss shenanigans is wearingly familiar. It is similar to the line the bank took after its operations in Mexico and Colombia were exposed in 2012 as being wide open to money laundering. We were told then that HSBC’s federated corporate structure was partly to blame. It prevented group management getting to grips with tricky local details, such as spotting those customers who were running multibillion-dollar drug cartels.
In a Swiss context the corporate plea is cast this way: “HSBC was run in a more federated way than it is today and decisions were frequently taken at a country level. In January 2011, new group management fundamentally changed the way HSBC is structured, managed and controlled.”
Nils Pratley, The Guardian
The individuals that Murphy refers to will presumably have been sent to prison by the Mags for non-payment of a fine. An entirely different matter.
It is also clear that in the same way that it's much easier to catch a speeding motorist, it is much easier to catch a TV licence cheat than someone who is evading tax.