The trial of Team47b (Tax evasion)

tiredofwhiners

Rick Chasey wrote:

Take 2 coffe shops on the high street. One has 4 shops across the UK, one is Starbucks. Now, on said high street, both shops function in the same way - only Starbucks pays an awful lot less tax. Now, on this high-street, the competition is no longer fair. It distorts the market and reduces choice for consumers.

1. Explain why if this is true, there are so many coffee shops in the high street, an ever increasing number in fact, if the big multinationals have it all tilted in their favour ?

2. Explain why the price of a coffee or whatever in the multinationals isn't the cheapest ?

3. Explain why UK chain coffee shops are not being put out of business by the big multinationals ?

Answer : the current state does not reduce choice, it does not reduce prices and that in fact, taxation levels are irrelevant.

pb21

tiredofwhiners wrote:

Rick Chasey wrote:

Take 2 coffe shops on the high street. One has 4 shops across the UK, one is Starbucks. Now, on said high street, both shops function in the same way - only Starbucks pays an awful lot less tax. Now, on this high-street, the competition is no longer fair. It distorts the market and reduces choice for consumers.

1. Explain why if this is true, there are so many coffee shops in the high street, an ever increasing number in fact, if the big multinationals have it all tilted in their favour ?

2. Explain why the price of a coffee or whatever in the multinationals isn't the cheapest ?

3. Explain why UK chain coffee shops are not being put out of business by the big multinationals ?

Answer : the current state does not reduce choice, it does not reduce prices and that in fact, taxation levels are irrelevant.

1. Are there?

2. Isn't it?

3. Aren't they?

Q)How many Starbucks would there be if they paid the same rate of tax as an independent coffee shop?

Q) How many independent coffee shops would there be if Starbucks paid the same rate of tax as an independent coffee shop?

Q) How much would a coffee cost in Starbucks if they paid the same rate of tax as an independent coffee shop?

tiredofwhiners

pb21 wrote:

1. Are there?

2. Isn't it?

3. Aren't they?

Q)How many Starbucks would there be if they paid the same rate of tax as an independent coffee shop?

Q) How many independent coffee shops would there be if Starbucks paid the same rate of tax as an independent coffee shop?

Q) How much would a coffee cost in Starbucks if they paid the same rate of tax as an independent coffee shop?

1. Yes there are.
2. It isn't
3.They are not.

The rest are irrelevancies - by virtue of the above, Starbucks probably wouldn't be affected, and could probably put prices up because people will still use them in preference to local shops. When was the last time you heard of a Starbucks having difficulty ? Even when the anti-capitalists of Occupy did their thing in London , the hypocrites still got their refreshments from the local Starbucks.

Try answering questions rather than trying to deflect inconvenient questions.

pb21

tiredofwhiners wrote:

pb21 wrote:

1. Are there?

2. Isn't it?

3. Aren't they?

Q)How many Starbucks would there be if they paid the same rate of tax as an independent coffee shop?

Q) How many independent coffee shops would there be if Starbucks paid the same rate of tax as an independent coffee shop?

Q) How much would a coffee cost in Starbucks if they paid the same rate of tax as an independent coffee shop?

1. Yes there are.
2. It isn't
3.They are not.

The rest are irrelevancies - by virtue of the above, Starbucks probably wouldn't be affected, and could probably put prices up because people will still use them in preference to local shops. When was the last time you heard of a Starbucks having difficulty ? Even when the anti-capitalists of Occupy did their thing in London , the hypocrites still got their refreshments from the local Starbucks.

Try answering questions rather than trying to deflect inconvenient questions.

I can’t answer the questions if I don’t know the answers. Do you have evidence to back up your answers.

So my questions that you haven’t answered are irrelevant, is that because you can’t answer them? Surely they are very important? You don’t know the answers to them because no one knows the answers to them. You supposedly know how the world works and everyone else is a moron. I think the world is a lot more complicated than you think and no one knows how it works.

You say when did I hear of a Starbucks having trouble? I ask how many non-existent independent coffee shops haven’t opened because Starbucks exists in the state it does?

Also the occupy protesters weren't all ‘anti-capitalist’ some of them were no doubt, but not all.

tiredofwhiners

pb21 wrote:

I can’t answer the questions if I don’t know the answers.

So you just replied to confirm you didn't know ? How very informative of you.

pb21 wrote:

You supposedly know how the world works and everyone else is a moron. I think the world is a lot more complicated than you think and no one knows how it works.

You're not very good at trolling are you ? Even children realise that effect follows cause. Drop a cup and it breaks. Spill water and it goes downhill. try to base a taxation system on 'morals' and expect people to pay 'what is right' isn't workable. The world is complex as you guessed, and expecting people to second guess what a tax law might mean isn;t half as sensible as following exactly what it says is a much better option. You don't have to know how the entire world works to know that if you squeeze a company in one area, it'll have unintended consequences. I have no problem with changing the law - but when you do, don't be surprised if it backfires and you end up doing something worse instead.

pb21 wrote:

I ask how many non-existent independent coffee shops haven’t opened because Starbucks exists in the state it does?

What sort of question is that ? With questions like that there is plainly no possible way to know the answer. Back to reading the Guardian or the Socialist Worker for your answers to everything I think.

You're not interested in answers as your dogma will not permit the circumstances where following the law gives an answer your morals cannot accept.

Frank the tank

To be called a moron by someone of the mega intellect that is "tiredofwhiners" is a honour and a privilage. Yeehaa!

I'll decline the temptation to name call as it's all very juvenile and I bet his dad's bigger than mine anyway.

Stevo_666

Frank the tank wrote:

So in a nutshell, it's a game.

Bit late back to this as I've been out all day. But basically, yep

pb21

@tiredofwhiners you accuse me of trolling but it's you who doesn't answer questions and tells someone they should answer yours. You also are the one resorting to petty insults and insinuation.

You also accuse me of being dogmatic (ha I couldn't be less dogmatic!) when all I am doing is challenging your claims. Like I say I don't know the answers so how that makes me dogmatic I have no idea! Instead you say you know how the world works and everyone else is a moron. As someone who doesn't but still wonders, that intrigues me but I don't just blindly accept what people say.

Anyway I don't disagree with what you say, just how you say it, and your somewhat hypocritical points. Oh and btw I won't be off reading the socialist worker now, but Atlas Shrugged which I've just started, probably something else you didn't know.

tiredofwhiners

pb21 wrote:

@tiredofwhiners you accuse me of trolling but it's you who doesn't answer questions and tells someone they should answer yours. You also are the one resorting to petty insults and insinuation.

Read the post - I posed three questions to someone else, not even you, to which your response was not to answer but to make ridiculous responses and then ask childish unanswerable questions. If I were to call you a half-wit personally to your face, that would be an insult but when I describe the actions and characteristics of a moron, and you rush to defend them, its a fair conclusion that you are drawing your own conclusion as thats to what you are.

You didn't challenge anything - you just asked more questions. Challenging requires the suggestion of an alternative hypothesis, rather than playing the Monty Python sketch of just disagreeing with everything and saying 'prove it'.

You seem obsessed with my statements about being a moron. I am tired of people like you who have no answers and just respond to everything with 'yeah, but <<insert question here>> when you have no idea at all of how the economy works, how the free trade area works and why your ideas are cloud cuckoo land. I have even less patience with people who would throw away laws and base everything around 'morals'.

PS You may have noticed that the law of unintended consequences is in action as Starbucks are said to be going to recoup their increases tax payments by cutting back on staff and wages. Its not as if anyone with even half a brain could have seen that coming is there ? Okay, its said by the Guardian which is a little less than reliable but I guess you'd catch up on that tomorrow.

Stevo_666

Rick Chasey wrote:

Either way, it gives a significant advantage to multinational firms over local rivals, since only the multinational has the resources and the settup necessary to be able to capitalise on said laws.

In an ideal world with ' fair competition' which surely all free-marketeers want, that wouldn't be the case, right?

Take 2 coffe shops on the high street. One has 4 shops across the UK, one is Starbucks. Now, on said high street, both shops function in the same way - only Starbucks pays an awful lot less tax. Now, on this high-street, the competition is no longer fair. It distorts the market and reduces choice for consumers.

The consumer benefits from fair compeition. In this, practical respect, it is not fair. It may be fair with regard to the law, but it is not fair in the respect explained above.

Does 'a lot less' tax include VAT, national insurance, income tax of the employees, business rates etc? People forget that corporation tax is less than 10% of the total UK tax take the last time I looked. The conversation in this respect is too narrow.

It's a fact of life that big companies have certain advantages over small ones in many industries, but the small operations also have advantages over the big chains like flexibility on product, pricing, shop design, personal appeal etc. I see quite a few independents doing well round my way.

pb21

tiredofwhiners wrote:

pb21 wrote:

@tiredofwhiners you accuse me of trolling but it's you who doesn't answer questions and tells someone they should answer yours. You also are the one resorting to petty insults and insinuation.

Read the post - I posed three questions to someone else, not even you, to which your response was not to answer but to make ridiculous responses and then ask childish unanswerable questions. If I were to call you a half-wit personally to your face, that would be an insult but when I describe the actions and characteristics of a moron, and you rush to defend them, its a fair conclusion that you are drawing your own conclusion as thats to what you are.

You didn't challenge anything - you just asked more questions. Challenging requires the suggestion of an alternative hypothesis, rather than playing the Monty Python sketch of just disagreeing with everything and saying 'prove it'.

You seem obsessed with my statements about being a moron. I am tired of people like you who have no answers and just respond to everything with 'yeah, but <<insert question here>> when you have no idea at all of how the economy works, how the free trade area works and why your ideas are cloud cuckoo land. I have even less patience with people who would throw away laws and base everything around 'morals'.

PS You may have noticed that the law of unintended consequences is in action as Starbucks are said to be going to recoup their increases tax payments by cutting back on staff and wages. Its not as if anyone with even half a brain could have seen that coming is there ? Okay, its said by the Guardian which is a little less than reliable but I guess you'd catch up on that tomorrow.

Wow there is so much wrong in that post that even I know! I would take the time to respond properly but I'm not convinced you're not trolling.

Yellow Peril

I think Tiredof whiners is fundamentally correct. Poor old Jimmy Carr copped for it the other month but he hadn't done anything wrong other than take advantage of a lawful tax scheme. For example would you refuse to take advantage of a family rail ticket which discounts travel for a family of four as opposed to paying a more expensive individual price?

Just as how there is a constant battle between the virus makers and the virus breakers in the world of computing so it is between government legislators and tax efficient scheme makers in the world of tax.

rick_chasey

Stevo 666 wrote:

Rick Chasey wrote:

Either way, it gives a significant advantage to multinational firms over local rivals, since only the multinational has the resources and the settup necessary to be able to capitalise on said laws.

In an ideal world with ' fair competition' which surely all free-marketeers want, that wouldn't be the case, right?

Take 2 coffe shops on the high street. One has 4 shops across the UK, one is Starbucks. Now, on said high street, both shops function in the same way - only Starbucks pays an awful lot less tax. Now, on this high-street, the competition is no longer fair. It distorts the market and reduces choice for consumers.

The consumer benefits from fair compeition. In this, practical respect, it is not fair. It may be fair with regard to the law, but it is not fair in the respect explained above.

Does 'a lot less' tax include VAT, national insurance, income tax of the employees, business rates etc? People forget that corporation tax is less than 10% of the total UK tax take the last time I looked. The conversation in this respect is too narrow.

It's a fact of life that big companies have certain advantages over small ones in many industries, but the small operations also have advantages over the big chains like flexibility on product, pricing, shop design, personal appeal etc. I see quite a few independents doing well round my way.

For sure.

For me the issue is different.

It's a personal thing but I think that the proportion of tax paid should be even across firms who operate and make money in the UK.

Ecomomies of scale do give firms advantage for sure - can usually buy for cheaper - more centralised systems help blah blah, but that's all defined by the market, which is fine. I too would give a dicount to a bigger purchaser of my product.

Tax levels ultimately aren't dertermined by the free market. They're determined by the gov't, and ultimately, it makes sense for the gov't to make sure the competition in the markets they govern is fair competition - and that includes tax.

Similarly, it probably makes sense to try and get a bit more tax if they can. The UK is big market, a good 70 million odd people who on average earn an awful lot, relative to the rest of the world. Being made to pay tax here isn't suddenly going to stop them trading here - espeically given how little they pay now. The profits from the UK versus the tax paid is crazy.

It's just a bit of common sense. If I see a firm makes a fortune out of selling coffee which is prepered and served in front of me, it makes common sense to me that they pay corporate tax on that coffee in the country where it's prepared and I'm buying it.

I'm not giving a particuarly moral or legal case, just a case of both common sense and market conditions that don't stifle smaller competition when it's not necessary. I find it difficult to see how it isn't in the broader public's interest that this is corrected.

The gov't should spend more money trying to close the inevitable loopholes that occur. As you've said before, loopholes arrise as soon as you make laws. But they can try and make it more and more difficult.

It's legal for firms to find ways to pay as little as possible (within reason) for sure, but that doesn't mean it's desirable for the general public or greater good. A bit like smoking or being an alcoholic. It's allowed, but it's not ideal.

pinno

We can now sumise what the protagonists of 'free trade' and capitalism in its current form:

Despite the increasing size and power of MNC's, its fine 'cos the independants are doing ok even though that like individuals they pay disproportionately more tax than the big boys and cannot compete.
(Except: The number of small businesses in the Uk that are going to the wall is astronomical and you cannot blame it all on the recession http://www.theregister.co.uk/ ).

The MNC's like Starbucks are foreign and foreign organisations leech money out of the domestic system whilst not paying enough corporation tax. "But thats fair because you can't base taxation on moral principles" ?!? I'm not asking for a taxation based on moral principles. I said that some activities were immoral but I did not say that we should base tax on a moral basis. I want better equality and a better distribution of wealth through a less inbalanced taxation system. Never mind how the world works in your eyes (tiredofbeingconceited), it needs fixing.

There is one huge flaw in the argumenst for how the world (doesn't work) works, its like that and thats they way it is.

Greece is a fantastic example of a whole nation whos life has been sucked out of it. Greece had so many loopholes that the rich did not pay and still don't pay sufficient tax. That is why the people are rioting, they are angry at the fact that they are paying for the sins of the rich who didn't pay enough tax.

The global crash happened. The banks were playing with money, literally. Suddenly credit has dried up and we have to tighten our belts whilst there are those who do not pay their way and there are companies who do not pay their fair share. They don't suffer, we suffer.
J McColl - advisor to Alex Salmond acts in an advisory capacity for Business strategy in Scotland. Mr McColl does not pay tax in the UK (He pays no tax and lives in Monaco). He is a multi billionaire. If I halved his income, there would be absolutely no drop in his standard of living and he definately would not suffer in any form. But thats fair, 'cos thats how the world works ? If I had a 15% drop in my income, I would be on the breadline. Read 'The Spirit level'. I doubt the aforesaid protagonists dare. They would say 'No, thats a lefty book, i'm not touching that'.

Stevo_666

pinarello001 wrote:

A very long summary of his views...

Like I said above, corporation tax is less than 10% of the UK tax take. You have to look at the total tax contribution before you shout about companies 'not contributing', (though I don't see how you're going to properly compare the total tax contribution of big chains vs independents). Here's one from a few years ago for the whole country, but it'll give you the general idea:



If a low rate of corporate tax was the main contributor to coffee shop success, then Costa (which paid 31% corporate tax on its profits) wouldn't be the biggest coffee chain in the UK That said, Starbucks most recent global corporate tax rate was about 32% according to their own figures so the picture is more complex than you're suggesting.

HMRC have seen their tax returns for years and are only looking into it now with Starbucks apparently in co-operation - suggests to me that a mix of political pressure on the Inland Revenue and a desire by Starbucks to effectively offer some extra tax over and above what they're obliged to pay in order to get rid of their PR issue is driving this.

The game goes on....

rick_chasey

S'all over newsnight btw.

Broadly the argument falls into two camps. The "they're following the law and the law should change if there is a problem..." and the "from a common sense perspective it doesn't make sense and the law should change".

Stevo_666

Rick Chasey wrote:

S'all over newsnight btw.

Broadly the argument falls into two camps. The "they're following the law and the law should change if there is a problem..." and the "from a common sense perspective it doesn't make sense and the law should change".

Good luck to them - the Govt has had many years to sort this out and they still can't do it. It's not like these things are new, it's just flavour of the month and Banker bashing has lost it's popular appeal so they need a new scapegoat.

Frank the tank

Yellow Peril wrote:

I think Tiredof whiners is fundamentally correct. Poor old Jimmy Carr copped for it the other month but he hadn't done anything wrong other than take advantage of a lawful tax scheme. For example would you refuse to take advantage of a family rail ticket which discounts travel for a family of four as opposed to paying a more expensive individual price?

Just as how there is a constant battle between the virus makers and the virus breakers in the world of computing so it is between government legislators and tax efficient scheme makers in the world of tax.

Fair point, but a poor analogy in the respect the discount would be offered because the railway is in competition with other public transport systems and your own private transport.

The Tax man isn't in competition with anyone (only those try to not pay it. )

Stevo_666

Frank the tank wrote:

Fair point, but a poor analogy in the respect the discount would be offered because the railway is in competition with other public transport systems and your own private transport.

The Tax man isn't in competition with anyone (only those try to not pay it. )

It's never a good idea to waste money on inefficient monopolies that have no incentive to provide a decent service

Actually as far as a lot of multinationals are concerned, the UK taxman is in competition - with tax authorities in other countries. If the UK taxman tries to treat multinationals too harshly they have the choice to divert investment elsewhere - and often do in my experience. The spate of companies moving their HQ's to places like Switzerland was a direct result of harsh UK rules on foreign profits, which has only been stemmed by a major revamp of the rules.