LEAVE the Conservative Party and save your country!

elbowloh

Stevo_666 said:

elbowloh said:

This is not about companies not paying enough / evading tax under the current rules is it? This is about changing the rules to make it "fairer" and so smaller companies (especially bricks and mortar companies) can compete isn't it?

On the basis that its about where you pay the tax I'm not clear how you come to that conclusion? Smaller companies typically pay lower rates of tax anyway and are exempt from many of the admin burdens that face multinationals.

Also I'm not sure that the tax system should compensate one type of business model because they are struggling g to compete, surely that is for businesses to work out?

Not according to the G7 leaders, no.

kingstongraham

Stevo_666 said:

kingstongraham said:

Stevo_666 said:

kingstongraham said:

If you can explain how the Microsoft example with Bermuda and Ireland passes a "well that actually seems reasonable now you've explained it" test, I'll happily bow to your greater knowledge.

"It's currently legal" is not enough when discussing potential rule changes.

Sorry, bit of a break to deal with house sale and purchases...

Got a link to the facts?

https://www.theregister.com/2021/06/03/microsoft_subsidiary_ireland/

Or Google Microsoft Round Island One and take your pick.

Not a lot of specifics to go on, but if a company is registered in Ireland but tax resident in Bermuda then presumably it has the requisite substance and activity/management and control in Bermuda. Were the Irish tax authorities objecting to this?

You think it's likely that Microsoft have $314.7bn worth of profits that can be logically attributed to their activities in Bermuda?

Note: not legally attributable, as I assume its all legal. I was asking if there was a way it could be explained that made sense for any reason other than simply reducing the overall tax bill.

Here's the guardian article about it. https://www.theguardian.com/world/2021/jun/03/microsoft-irish-subsidiary-paid-zero-corporate-tax-on-220bn-profit-last-year

And the Irish Times with more details https://www.irishtimes.com/business/technology/irish-registered-subsidiary-of-microsoft-records-314bn-profit-1.4565525

rjsterry

elbowloh said:

This is not about companies not paying enough / evading tax under the current rules is it? This is about changing the rules to make it "fairer" and so smaller companies (especially bricks and mortar companies) can compete isn't it?

I'm not sure it is either. Small bricks and mortar companies don't necessarily want or need to compete with global corporations.

kingstongraham

Taking a plane to the G7 from Stanstead to talk about climate change has very big "yeah whatever" vibes.

surrey_commuter

kingstongraham said:

Taking a plane to the G7 from Stanstead to talk about climate change has very big "yeah whatever" vibes.

who did that?

shirley_basso

Guess

surrey_commuter

shirley_basso said:

Guess

I know this is the Tory thread but why would Boris travel from Westminster to Stansted to fly to Cornwall? if he had headed west he would have been halfway there in the same time it would take him to get to Stansted

pblakeney

Regardless of the practicalities the most important thing is the image of the "big I am".

kingstongraham

surrey_commuter said:

shirley_basso said:

Guess

I know this is the Tory thread but why would Boris travel from Westminster to Stansted to fly to Cornwall? if he had headed west he would have been halfway there in the same time it would take him to get to Stansted

Because
and


Chartered Airbus A321.

surrey_commuter

kingstongraham said:

surrey_commuter said:

shirley_basso said:

Guess

I know this is the Tory thread but why would Boris travel from Westminster to Stansted to fly to Cornwall? if he had headed west he would have been halfway there in the same time it would take him to get to Stansted

Because
and


Chartered Airbus A321.

what happened to the plane he bought and had painted in the Union Jack?

Pross

Surely if he really had to fly he could have gone from City airport in something smaller or, at a push, Heathrow if he really, really had to be seen arriving in a full size airliner? Let's face it, a chartered BA Airbus still looks like amateur stuff if trying to compete with POTUS and his full livery Airforce 1.

When the NATO summit was held up the road from me everyone else was travelling from the hotel to Cardiff by car. I was commuting home from Cardiff by bike to avoid the anticipated traffic chaos and just before I got back home had the s**t scared out of me by Obama's Osprey flying over my head at treetop height getting ready to land.

focuszing723

surrey_commuter said:

kingstongraham said:

surrey_commuter said:

shirley_basso said:

Guess

I know this is the Tory thread but why would Boris travel from Westminster to Stansted to fly to Cornwall? if he had headed west he would have been halfway there in the same time it would take him to get to Stansted

Because
and


Chartered Airbus A321.

what happened to the plane he bought and had painted in the Union Jack?

Perhaps the G7 should be discussing a continental hyperloop system to connect the major land masses

kingstongraham

surrey_commuter said:

kingstongraham said:

surrey_commuter said:

shirley_basso said:

Guess

I know this is the Tory thread but why would Boris travel from Westminster to Stansted to fly to Cornwall? if he had headed west he would have been halfway there in the same time it would take him to get to Stansted

Because
and


Chartered Airbus A321.

what happened to the plane he bought and had painted in the Union Jack?

Maybe it was the second one of those then. We've got two, the second one is an A321.

elbowloh

This is why they're building a boat.

john80

Stevo_666 said:

john80 said:

Stevo_666 said:

And lets see how big an issue this big corporate taxa avoidance is in the scheme of things, using the UK as an example and HMRC's own figures:

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/907122/Measuring_tax_gaps_2020_edition.pdf

A quick look at page 5 will show you that the majority of the 'tax gap' in the UK is down to sectors other than big business (which accounts for £5.3bn out of £31bn) and that avoidance accounts for £1.7bn out of the £31bn (just over 5% of the total). Of which avoidance related to tax havens will be a small part of the £1.7bn).

So it doesn't take a genius to work out that this mythical tax haven black hole for taxes is a small piece of the puzzle. But it makes good headlines and many politicians think they get kudos for bashing those seen to have deep pockets. Their energy is better directed elsewhere if they actually want maximise tax revenues.

If this is I suspect a report highlighting small business for non payment whilst missing out all the global corporates legitimate off shoring then it does not paint the complete picture.

Amazon did 26 billion of sales in the UK in US dollars in 2020. If we assume they make 10% profit of turnover and paid 20% on this as corporation tax then this is 520 million. Whilst this is a crude calculation one major company is potentially gaining this amount going offshore.

As always you are arguing for tax competition when the reality this is always a race to the bottom which benefits only a few. Tax competition is nonsense as even if they were made to pay the 20% tax with no offshoring only a moron would shut down Amazon's UK business as revenge or seek to run the business more inefficiently to save tax by being less profitable.

The 'race to the bottom' phrase is a lazy leftie phrase with no real substance.

Tax competition is not fundamentally different from from other types of competition. If you are looking online for (say) a new phone and one website offers you a better price than the rest, you don't moan that its a 'race to the bottom' on phone prices, do you? That's what competition is about, however some people seem to think it shouldn't apply where they don't want it to apply.

Maybe switch you logic round and consider the the UK has certain overheads to cover the wishes of the population. You education, healthcare etc. If you want to do business in the UK it is not unreasonable for the UK to want those overheads covered as you are making you buck off those citizens whose wishes cost money. Now they could cover all those costs by ignoring business and purely taxing people but their is a balance to be struck as business benefits from all those people they employ being both educated, alive and being part of some sort of organised society. By all means take you business to France if their tax is lower but you get the gist surely that this is not really a competition thing as most things require you to operate in the countries market. It is about as good an analogy as those that think privatising water pipes is a good idea but yeah you crack on.

kingstongraham

Stevo_666 said:

kingstongraham said:

Stevo_666 said:

kingstongraham said:

If you can explain how the Microsoft example with Bermuda and Ireland passes a "well that actually seems reasonable now you've explained it" test, I'll happily bow to your greater knowledge.

"It's currently legal" is not enough when discussing potential rule changes.

Sorry, bit of a break to deal with house sale and purchases...

Got a link to the facts?

https://www.theregister.com/2021/06/03/microsoft_subsidiary_ireland/

Or Google Microsoft Round Island One and take your pick.

Not a lot of specifics to go on, but if a company is registered in Ireland but tax resident in Bermuda then presumably it has the requisite substance and activity/management and control in Bermuda. Were the Irish tax authorities objecting to this?

For reference, that would be about $5 million of profit per resident of Bermuda. It seems unlikely that the profit originates from Microsoft's activities in Bermuda.

rick_chasey

World says rules need to be changed because they aren't doing what they're supposed to.

Stevo says people obey the existing rules so it's fine.

This is the summary.

rjsterry

rick_chasey said:

World says rules need to be changed because they aren't doing what they're supposed to.

Stevo says people obey the existing rules so it's fine.

This is the summary.

TBF, those statements are not contradictory. Those setting the rules need to decide what their overall aims are and then assess the rules against that. It's not clear what those aims are so difficult to say how well the rules achieve those aims.

rick_chasey

rjsterry said:

rick_chasey said:

World says rules need to be changed because they aren't doing what they're supposed to.

Stevo says people obey the existing rules so it's fine.

This is the summary.

TBF, those statements are not contradictory. Those setting the rules need to decide what their overall aims are and then assess the rules against that. It's not clear what those aims are so difficult to say how well the rules achieve those aims.

The aims are fairly simple.

Multinational firms exploit loopholes in international an national tax rules to pay a materially lower corporate tax rate than their national or regional rivals.

This distorts tax takes, the markets in which the multinationals operate, and generally do harm to both consumers and the only people who really benefits are directly involved with the firms themselves.

The idea is to have the bigger economies which are critical to these multi-nationals to work together to make sure these multinationals pay a minimum amount of corporate tax where their economic activity is in order to reduce these negative externality.

So to use the coffee example, the local coffee shop down my road should be paying roughly the same proportion of its profits as corporate tax as starfucks for all its coffeeshops in the UK.


Stevo is saying "there are rules in place and because people follow them there is no need to change the rules"

It is a way of hiding behind a general idea that he shares with the tax payer's alliance which is basically whatever means less tax is paid is good.

rjsterry

rick_chasey said:

rjsterry said:

rick_chasey said:

World says rules need to be changed because they aren't doing what they're supposed to.

Stevo says people obey the existing rules so it's fine.

This is the summary.

TBF, those statements are not contradictory. Those setting the rules need to decide what their overall aims are and then assess the rules against that. It's not clear what those aims are so difficult to say how well the rules achieve those aims.

The aims are fairly simple.

Multinational firms exploit loopholes in international an national tax rules to pay a materially lower corporate tax rate than their national or regional rivals.

This distorts tax takes, the markets in which the multinationals operate, and generally do harm to both consumers and the only people who really benefits are directly involved with the firms themselves.

The idea is to have the bigger economies which are critical to these multi-nationals to work together to make sure these multinationals pay a minimum amount of corporate tax where their economic activity is in order to reduce these negative externality.

So to use the coffee example, the local coffee shop down my road should be paying roughly the same proportion of its profits as corporate tax as starfucks for all its coffeeshops in the UK.


Stevo is saying "there are rules in place and because people follow them there is no need to change the rules"

It is a way of hiding behind a general idea that he shares with the tax payer's alliance which is basically whatever means less tax is paid is good.

You have managed to write all of that without actually stating what the aims of the existing tax rules are. Clearly there are at least two in very general terms: raise revenue and modify behaviour. From the point of view of Bermuda or Luxembourg it does that very well and provides a source of income for small states with few other options. I can certainly see why some larger companies would want to steal back some of that revenue by removing the option to offer a lower rate, leaving the likes of Bermuda with not much to offer global corporations besides some nice beaches.

rick_chasey

Sure but the gain to Bermuda etc is minimal compared to the loss elsewhere.

You can look it up - plenty of calculations have been done on the cost of this type of behaviour.

rjsterry

Bermuda might not see it that way. Sure there is some revenue 'we' miss out on but it does feel a little like Waitrose insisting on minimum pricing so that Aldi can't undercut them.

rick_chasey

rjsterry said:

Bermuda might not see it that way. Sure there is some revenue 'we' miss out on but it does feel a little like Waitrose insisting on minimum pricing so that Aldi can't undercut them.

Most economists would disagree with you.

The overall cost to the world is enormous.

It is not an efficient way to run the world, and it massively distorts markets. You want to encourage competition, not put up market barriers to new entrants.

What Bermuda etc gain is a drop in the ocean vs the costs.

kingstongraham

rjsterry said:

Bermuda might not see it that way. Sure there is some revenue 'we' miss out on but it does feel a little like Waitrose insisting on minimum pricing so that Aldi can't undercut them.

no it doesn't.

It's also what Stevo's insistence on asking "are Ireland complaining" misses.

If you want an analogy, it's more Waitrose asking for it to not be legal to drill a hole in Waitrose's warehouse, and give the stock away for a small fixed fee, while adding absolutely nothing to the process by which Waitrose has stocked the warehouse.

What do Bermuda add to the process other than the absence of tax?

Pross

kingstongraham said:

rjsterry said:

Bermuda might not see it that way. Sure there is some revenue 'we' miss out on but it does feel a little like Waitrose insisting on minimum pricing so that Aldi can't undercut them.

no it doesn't.

It's also what Stevo's insistence on asking "are Ireland complaining" misses.

If you want an analogy, it's more Waitrose asking for it to not be legal to drill a hole in Waitrose's warehouse, and give the stock away for a small fixed fee, while adding absolutely nothing to the process by which Waitrose has stocked the warehouse.

What do Bermuda add to the process other than the absence of tax?

Somewhere nice for posh ex-pats to live and work?

shirley_basso

Short length suits?

rjsterry

rick_chasey said:

rjsterry said:

Bermuda might not see it that way. Sure there is some revenue 'we' miss out on but it does feel a little like Waitrose insisting on minimum pricing so that Aldi can't undercut them.

Most economists would disagree with you.

The overall cost to the world is enormous.

It is not an efficient way to run the world, and it massively distorts markets. You want to encourage competition, not put up market barriers to new entrants.

What Bermuda etc gain is a drop in the ocean vs the costs.

Not for Bermuda it isn't. They're small, so don't need a lot. I'm not sure how Bermuda being able to set its own tax regime is putting up barriers, but I can certainly see that the exchequers of larger nations with different tax regimes miss out on some potential revenue from those businesses. I still think we're looking at it the wrong way round and should start from first principles. What is the problem? Is it that the exchequer is not receiving enough revenue? At 8% of total revenue is tweaking the rate another country charges going to shift the dial much?

Is it that certain businesses by virtue of their size have access to facilities to a distorting tax advantage? Lots of things are available to larger firms that just don't make any sense at a smaller scale. I remain to be convinced that lack of access to these facilities is what is holding smaller businesses back, but maybe. Anyway if the argument can be built up this way it has a better chance than just grumbling about it not being fair that Amazon only paid X in Y country on sales of [big number].

kingstongraham

It's both. They are freeloading, and distorting the market.

briantrumpet

Dunno where to put this, but as it references cod Latin, I'll dump it here. https://www.esquire.com/news-politics/a36439329/rise-of-elevated-stupidity-cable-news-politics/

rjsterry

Someone on Twitter compared Hancock to Lieutenant Grüber from 'Allo 'Allo, and Johnson to Jesse "this week I'll mostly be..." from the Fast Show and now I can't unsee it.