Just Pay Your Tax::: God damn

Stevo_666

Rick Chasey wrote:

Dependa doesn't it.

Sounds to me like they could tighten the laws up.

Every bit helps with the deficit dunnit?

Nothing to tighten up, it is a deliberate exemption in the law.

Stevo_666

Rick Chasey wrote:

How prescient.

http://www.telegraph.co.uk/business/201 ... september/

The amount of income central Government received in September totalled £49bn, an increase of 2.6pc on a year ago. There were higher contributions from National Insurance, VAT receipts, income tax-related payments and fuel duty.

Corporate tax, however, slumped by nearly 9pc to £2.3bn.

I have explained before that governments generally are deliberately shifting away from corporation tax as a source of revenue and into other taxes such as payroll, VAT etc for a number of reasons. There are references to that in the PwC report that I linked on page 1 of this thread. I can explain it again if you like...

rick_chasey

No.

The disagreement is fairly fundamental.

You find arbitration of tax regulation wholly acceptable and encourageable.

I see it as an unfortunate and costly negative externality resulting from the practicalities of collecting tax effectively.

Stevo_666

Rick Chasey wrote:

No.

The disagreement is fairly fundamental.

You find arbitration of tax regulation wholly acceptable and encourageable.

I see it as an unfortunate and costly negative externality resulting from the practicalities of collecting tax effectively.

What arbitration are you talking about exactly? There is none in the specific Mondelez example above.

If you are talking about the shift from one type of tax to others then it is being done because it is yields more to do that in in many cases is easier to collect. It's pretty common knowledge that low CT rates can attract international business - Ireland is a good example. The yields from the payroll taxes, VAT, rates etc that then flow from that investment and activity are usually substantial. It's called tax competition and most countries are doing it - for example France announced a cut in its company tax rate recently, so if even the French government get it, why don't you?

Wheelspinner

Rick V Stevo...

rick_chasey

It's fairly basic.

To me, "tax competition" is a race towards the bottom with regard to taxes. Within reason, lower taxes yield lower tax receipts, with a few well known exceptions. Small states link singers and honkers can get away with it because of the efficiency of small cities. Proper nations can't get away with that.

Now I believe that there are certain things that are best handled by the state. They also need to be paid for.

Now, I also see a distinct advantage to large and international firms over smaller firms with regard to tax arbitration; that's how apple can have an effective tax rate in Ireland of 0.05%.

I spoke to a group Treasurer of a large drilling firm who boasted of his overall effective tax rate of 7% because he had hired some of the smartest minds to circumvent them.

Now I don't see that Labour and expertise adding much value to the world, and it has a real social cost.
Furthermore:
When your local sandwich shop still has to pay the full rate because they can't afford and don't have the expertise to shift money around to avoid tax, I see that as unfair competition. And I don't see any beneficiaries of that competition other than for the firm engaged in the activities.

So on a few levels I have problems with it.

I see a problem of social obligation - these firms benefit from the state services but shy away from paying them

I see the costs of firms paying less tax than the tax system was designed for (through regulatory arbitration) as being undervalued.

I draw a line between people and firms paying less tax than the state intended and less funding for state run things. Many others contribute sure but there is an element of that.

And I see the complexity and cost of taking advantage of those tax loopholes as putting small firms at a disadvantage to big firms - and I don't think that is conducive to a thriving economy.

I'm taking a macro view on this.

Stevo_666

Your view is based on a number of incorrect assumptions. Some of it I have already explained but you seem to have missed the points. Unfortunately I have to get back to a bit of tax planning this afternoon so will reply later

Stevo_666

PS: we have now moved onto a more general debate about tax, as there is nothing to suggest that Mondelez has done anything wrong at all. It was just another tax moan based on superficial facts and incorrect assumptions.

rick_chasey

I'm not talking about modolez. You are with someone else.

I fundamentally think the outcome of google paying an effective tax rate of 0.05% in Ireland, when the headline tax rate is 12.5%, is not good for society.

I fundamentally think that something needs to be done to stop that type of thing happening.

It's that simple. You get get caught in the weeds of what's legal and what isn't - I couldn't really give much of a sh!t.

Fundamentally, firms, people, everyone, needs to pay what the rules were designed for you to pay. It should not be a function of how financially literate and sophisticated you are to exploit unintended loopholes and unscrupulous states.

wallace_and_gromit

Rick Chasey wrote:

I fundamentally think that something needs to be done to stop that type of thing happening.

Get rid of corporation tax. Make up the lost revenues via other, less avoidable, taxes. Do it over 5-10 years, so no-one is hit too hard by the changes in a single year. Simples!

rick_chasey

Sure - though plenty of individuals do the same.

I've had a number of candidates in the past ask me if my clients are willing to pay them in Switzerland despite not working there.

slowbike

you have to ask, just why are countries tax systems so complicated?
Corp tax, Er's NI, Ee's NI, Income tax, VAT etc etc etc.

Is it partly job creation? If you create a complicated structure then you need people to police it - and the companies need people to circumvent it, plus we need lawyers to argue it and judges to decide who is right/wrong - it all makes jobs for people .. even if it's not actually achieving anything.

Perhaps it's a price of democracy? We can argue against the state - in other countries you can't - you pay what they say - end of ... no arguing .. but then you're not allowed to do all sorts of other things.

TheBigBean

Wallace and Gromit wrote:

Rick Chasey wrote:

I fundamentally think that something needs to be done to stop that type of thing happening.

Get rid of corporation tax. Make up the lost revenues via other, less avoidable, taxes. Do it over 5-10 years, so no-one is hit too hard by the changes in a single year. Simples!

But, for example, Google wouldn't then need to pay any tax in the UK. It doesn't need to employ staff in the UK.

wallace_and_gromit

TheBigBean wrote:

Wallace and Gromit wrote:

Rick Chasey wrote:

I fundamentally think that something needs to be done to stop that type of thing happening.

Get rid of corporation tax. Make up the lost revenues via other, less avoidable, taxes. Do it over 5-10 years, so no-one is hit too hard by the changes in a single year. Simples!

But, for example, Google wouldn't then need to pay any tax in the UK. It doesn't need to employ staff in the UK.

Google doesn't pay much tax in the UK as it is as far as I know.

I wasn't thinking of increasing taxes on a particular company so that it pays the notional amount of tax that people think it should. I was thinking of abolishing corporation tax over time and simply filling the gap with alternative, harder to avoid taxes. Ultimately, individuals pay tax either directly or in increased prices, so they might as well get "stung" in an unavoidable way.

There are two disadvantages:

1 - Whilst corporation tax doesn't raise much on the grand scale of things, to cover it by - for example - a rise in income tax would not go down well.

2 - Without the bogeyman of tax-dodging multinationals, the Guardian would need another bogeyman to blame for society's ills!

TheBigBean

Wallace and Gromit wrote:

TheBigBean wrote:

Wallace and Gromit wrote:

Rick Chasey wrote:

I fundamentally think that something needs to be done to stop that type of thing happening.

Get rid of corporation tax. Make up the lost revenues via other, less avoidable, taxes. Do it over 5-10 years, so no-one is hit too hard by the changes in a single year. Simples!

But, for example, Google wouldn't then need to pay any tax in the UK. It doesn't need to employ staff in the UK.

Google doesn't pay much tax in the UK as it is as far as I know.

I wasn't thinking of increasing taxes on a particular company so that it pays the notional amount of tax that people think it should. I was thinking of abolishing corporation tax over time and simply filling the gap with alternative, harder to avoid taxes. Ultimately, individuals pay tax either directly or in increased prices, so they might as well get "stung" in an unavoidable way.

There are two disadvantages:

1 - Whilst corporation tax doesn't raise much on the grand scale of things, to cover it by - for example - a rise in income tax would not go down well.

2 - Without the bogeyman of tax-dodging multinationals, the Guardian would need another bogeyman to blame for society's ills!

My point was if the UK had no corporation tax and higher direct personal taxes then Google would HQ itself and its brand in the UK and employ people in another country. That way it would pay no tax on its corporate profits and its employees would pay a lower tax rate courtesy of the corporate tax subsidy from other companies in the other country.

The problem is adapting the tax code to fit with globalisation. Previously it would have been impossible for Amazon to argue its sales were coming from Luxembourg because they would have needed an actual shop in the UK.

RideOnTime

Stevo 666 wrote:

PS: we have now moved onto a more general debate about tax, as there is nothing to suggest that Mondelez has done anything wrong at all. It was just another tax moan based on superficial facts and incorrect assumptions.

Why are you telling us we've moved on...
Judge 666 Rinder
you haven't finished brown nosing Mondelez International I'm sure...

Stevo_666

RideOnTime wrote:

Stevo 666 wrote:

PS: we have now moved onto a more general debate about tax, as there is nothing to suggest that Mondelez has done anything wrong at all. It was just another tax moan based on superficial facts and incorrect assumptions.

Why are you telling us we've moved on...
Judge 666 Rinder
you haven't finished brown nosing Mondelez International I'm sure...

We have because you produced no evidence to support your claim. At all.

rick_chasey

Steve doesn't understand the social utility of tax.

joelsim

Rick Chasey wrote:

Steve doesn't understand the social utility of tax.

^This. Multiplied by 21%.

FWIW we can all protest by not shopping with companies that are shown to be taking the p!ss, the Starbucks, Amazons of this world.

Stevo_666

Rick Chasey wrote:

Steve doesn't understand the social utility of tax.

Standard leftie response from someone who doesnt understand the realities of tax.

Stevo_666

Joelsim wrote:

Rick Chasey wrote:

Steve doesn't understand the social utility of tax.

^This. Multiplied by 21%.

FWIW we can all protest by not shopping with companies that are shown to be taking the p!ss, the Starbucks, Amazons of this world.

I see the kangaroo court is in session :roll:

rick_chasey

Stevo 666 wrote:

Rick Chasey wrote:

Steve doesn't understand the social utility of tax.

Standard leftie response from someone who doesnt understand the realities of tax.

FFS stevo. I'm really not very lefty.

I work in an industry which is famously cutthroat, for an industry which is fundamentally at the heart of capitalism.

You find it very difficult to take a position beyond the individual. You do the same on schools, you do the same on tax.

All you see is tax as a penalty on you or your business, and you see competition to whittle it down as a bonus.

Now, i'm not gonna sit here and say that I think 70% tax rates are beneficial. I'm not an idiot.

But you fundamentally struggle to understand the problems from a broader societal perspective. You literally refuse to believe that I would put political choices that put the rest of society above those of my own personal benefit.


I think that says a lot more about you than it does me. But the fact you think me, a right-of-the-lib-dem-centre capitalist as left wing shows how extreme you are.

mamba80

Stevo 666 wrote:

Rick Chasey wrote:

Steve doesn't understand the social utility of tax.

Standard leftie response from someone who doesnt understand the realities of tax.

what is the purpose of tax Steveo ? from a far right pov.

Stevo_666

Rick Chasey wrote:

It's fairly basic.

To me, "tax competition" is a race towards the bottom with regard to taxes. Within reason, lower taxes yield lower tax receipts, with a few well known exceptions. Small states link singers and honkers can get away with it because of the efficiency of small cities. Proper nations can't get away with that.

Now I believe that there are certain things that are best handled by the state. They also need to be paid for.

Now, I also see a distinct advantage to large and international firms over smaller firms with regard to tax arbitration; that's how apple can have an effective tax rate in Ireland of 0.05%.

I spoke to a group Treasurer of a large drilling firm who boasted of his overall effective tax rate of 7% because he had hired some of the smartest minds to circumvent them.

Now I don't see that Labour and expertise adding much value to the world, and it has a real social cost.
Furthermore:
When your local sandwich shop still has to pay the full rate because they can't afford and don't have the expertise to shift money around to avoid tax, I see that as unfair competition. And I don't see any beneficiaries of that competition other than for the firm engaged in the activities.

So on a few levels I have problems with it.

I see a problem of social obligation - these firms benefit from the state services but shy away from paying them

I see the costs of firms paying less tax than the tax system was designed for (through regulatory arbitration) as being undervalued.

I draw a line between people and firms paying less tax than the state intended and less funding for state run things. Many others contribute sure but there is an element of that.

And I see the complexity and cost of taking advantage of those tax loopholes as putting small firms at a disadvantage to big firms - and I don't think that is conducive to a thriving economy.

I'm taking a macro view on this.

Countries know that multinationals to a reasonable degree can choose where to invest their capital and base their activities and they benefit from having these activities in their countries. It's like any other competitive market, you have to compete. It is simply the way things are, doesn't matter if you like it or not. Without this, countries are often tempted to simply jack up taxes rather than look at whether they are spending wisely - so it helps keep government and politicians 'honest'.

You again miss the point that corporate tax is only a small part of total tax revenues and that often it is used as an incentive to get companies to invest. The greater benefits then flow from other taxes. So for every dollar in corporate taxes you give away, if you make 2 or 3 dollars back in payroll tax, VAT etc then it makes sense. This is why there is a move away from CT as a revenue raiser and towards indirect taxes.

As for the alleged unfairness of large groups being able plan for taxes but small companies not, the numbers don't support that. Smaller operations may do things differently like not declaring income.
https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/561312/HMRC-measuring-tax-gaps-2016.pdf
Have a look at the summary charts on pg 5. Only 10% of the tax gap is corporate tax. Small businesses and individuals are responsible for the majority of the amounts.

Your view of tax is way too simple - in the business world there are many different ways to structure transactions, business affairs and funding - all perfectly legal, but with different outcomes. Too many people seem to think that not taking the most expensive route from a tax point of view is somehow avoidance.

I shouldn't have to remind you that we all have the right (enshrined in case law) to order our tax affairs as we see fit within the law and not so that the tax man can stick the largest possible shovel into it.

Stevo_666

Rick Chasey wrote:

Stevo 666 wrote:

Rick Chasey wrote:

Steve doesn't understand the social utility of tax.

Standard leftie response from someone who doesnt understand the realities of tax.

FFS stevo. I'm really not very lefty.

I work in an industry which is famously cutthroat, for an industry which is fundamentally at the heart of capitalism.

You find it very difficult to take a position beyond the individual. You do the same on schools, you do the same on tax.

All you see is tax as a penalty on you or your business, and you see competition to whittle it down as a bonus.

Now, i'm not gonna sit here and say that I think 70% tax rates are beneficial. I'm not an idiot.

But you fundamentally struggle to understand the problems from a broader societal perspective. You literally refuse to believe that I would put political choices that put the rest of society above those of my own personal benefit.


I think that says a lot more about you than it does me. But the fact you think me, a right-of-the-lib-dem-centre capitalist as left wing shows how extreme you are.

You make lots of assumptions about me that are complete bollox. Most likely by assuming things from what I haven't said.

Trouble is, government and politicians will spend too much if given a chance. Vanity projects, vote buying, social engineering attempts. Tax competition keeps them on their toes and forces them to spend more wisely, reduce waste etc. Now that is a service to society.

Stevo_666

mamba80 wrote:

Stevo 666 wrote:

Rick Chasey wrote:

Steve doesn't understand the social utility of tax.

Standard leftie response from someone who doesnt understand the realities of tax.

what is the purpose of tax Steveo ? from a far right pov.

To help educate idiots so they can spell my username name properly?

Stevo_666

While you're at it, maybe one of you lot can actually produce some evidence about Mondelez alleged tax dodging - the original point of the thread - given that the OP has singularly failed to do so.

Moving the thread onto a wider philosophical debate about tax tells me the original argument has been lost

pblakeney

On topic according to the thread title.
Which I saw and immediately thought of this..
https://www.youtube.com/watch?v=LJ25-U3jNWM

Jez mon

Stevo 666 wrote:

Rick Chasey wrote:

Stevo 666 wrote:

Rick Chasey wrote:

Steve doesn't understand the social utility of tax.

Standard leftie response from someone who doesnt understand the realities of tax.

FFS stevo. I'm really not very lefty.

I work in an industry which is famously cutthroat, for an industry which is fundamentally at the heart of capitalism.

You find it very difficult to take a position beyond the individual. You do the same on schools, you do the same on tax.

All you see is tax as a penalty on you or your business, and you see competition to whittle it down as a bonus.

Now, i'm not gonna sit here and say that I think 70% tax rates are beneficial. I'm not an idiot.

But you fundamentally struggle to understand the problems from a broader societal perspective. You literally refuse to believe that I would put political choices that put the rest of society above those of my own personal benefit.


I think that says a lot more about you than it does me. But the fact you think me, a right-of-the-lib-dem-centre capitalist as left wing shows how extreme you are.

You make lots of assumptions about me that are complete bollox. Most likely by assuming things from what I haven't said.

Trouble is, government and politicians will spend too much if given a chance. Vanity projects, vote buying, social engineering attempts. Tax competition keeps them on their toes and forces them to spend more wisely, reduce waste etc. Now that is a service to society.

Clearly that doesn't work though. Because the last thing politicians will want to cut is their vanity projects. There's plenty of money in glamorous hs2 but for gradual improvements to local rail, forget about it. Plenty of money for some stupid garden bridge in the centre of London too...

ballysmate

Stevo 666 wrote:

While you're at it, maybe one of you lot can actually produce some evidence about Mondelez alleged tax dodging - the original point of the thread - given that the OP has singularly failed to do so.

Moving the thread onto a wider philosophical debate about tax tells me the original argument has been lost

Appears not.