Archive for the ‘tax cheats’ Tag

We’re all in this together – but some of us more than others

Bad stuff is going on – beware, be angry and be active…

This chilling comment piece by George Monbiot was published in today’s Guardian (Comment is Free):

To us, it’s an obscure shift of tax law. To the City, it’s the heist of the century

In David Cameron we have a leader whose job is to quietly legitimise a semi-criminal, money-laundering economy

  • George Monbiot
  • ‘I would love to see tax reductions,” David Cameron told the Sunday Telegraph at the weekend, “but when you’re borrowing 11% of your GDP, it’s not possible to make significant net tax cuts. It just isn’t.” Oh no? Then how come he’s planning the biggest and crudest corporate tax cut in living memory?

    If you’ve heard nothing of it, you’re in good company. The obscure adjustments the government is planning to the tax acts of 1988 and 2009 have been missed by almost everyone – and are, anyway, almost impossible to understand without expert help. But as soon as you grasp the implications, you realise that a kind of corporate coup d’etat is taking place.

    Like the dismantling of the NHS and the sale of public forests, no one voted for this measure, as it wasn’t in the manifestos. While Cameron insists that he occupies the centre ground of British politics, that he shares our burdens and feels our pain, he has quietly been plotting with banks and businesses to engineer the greatest transfer of wealth from the poor and middle to the ultra-rich that this country has seen in a century. The latest heist has been explained to me by the former tax inspector, now a Private Eye journalist, Richard Brooks and current senior tax staff who can’t be named. Here’s how it works.

    At the moment tax law ensures that companies based here, with branches in other countries, don’t get taxed twice on the same money. They have to pay only the difference between our rate and that of the other country. If, for example, Dirty Oil plc pays 10% corporation tax on its profits in Oblivia, then shifts the money over here, it should pay a further 18% in the UK, to match our rate of 28%. But under the new proposals, companies will pay nothing at all in this country on money made by their foreign branches.

    Foreign means anywhere. If these proposals go ahead, the UK will be only the second country in the world to allow money that has passed through tax havens to remain untaxed when it gets here. The other is Switzerland. The exemption applies solely to “large and medium companies”: it is not available for smaller firms. The government says it expects “large financial services companies to make the greatest use of the exemption regime”. The main beneficiaries, in other words, will be the banks.

    But that’s not the end of it. While big business will be exempt from tax on its foreign branch earnings, it will, amazingly, still be able to claim the expense of funding its foreign branches against tax it pays in the UK. No other country does this. The new measures will, as we already know, accompany a rapid reduction in the official rate of corporation tax: from 28% to 24% by 2014. This, a Treasury minister has boasted, will be the lowest rate “of any major western economy”. By the time this government is done, we’ll be lucky if the banks and corporations pay anything at all. In the Sunday Telegraph, David Cameron said: “What I want is tax revenue from the banks into the exchequer, so we can help rebuild this economy.” He’s doing just the opposite.

    These measures will drain not only wealth but also jobs from the UK. The new legislation will create a powerful incentive to shift business out of this country and into nations with lower corporate tax rates. Any UK business that doesn’t outsource its staff or funnel its earnings through a tax haven will find itself with an extra competitive disadvantage. The new rules also threaten to degrade the tax base everywhere, as companies with headquarters in other countries will demand similar measures from their own governments.

    So how did this happen? You don’t have to look far to find out. Almost all the members of the seven committees the government set up “to provide strategic oversight of the development of corporate tax policy” are corporate executives. Among them are representatives of Vodafone, Tesco, BP, British American Tobacco and several of the major banks: HSBC, Santander, Standard Chartered, Citigroup, Schroders, RBS and Barclays.

    I used to think of such processes as regulatory capture: government agencies being taken over by the companies they were supposed to restrain. But I’ve just read Nicholas Shaxson’s Treasure Islands – perhaps the most important book published in the UK so far this year – and now I’m not so sure. Shaxson shows how the world’s tax havens have not, as the OECD claims, been eliminated, but legitimised; how the City of London is itself a giant tax haven, which passes much of its business through its subsidiary havens in British dependencies, overseas territories and former colonies; how its operations mesh with and are often indistinguishable from the laundering of the proceeds of crime; and how the Corporation of the City of London in effect dictates to the government, while remaining exempt from democratic control. If Hosni Mubarak has passed his alleged $70bn through British banks, the Egyptians won’t see a piastre of it.

    Reading Treasure Islands, I have realised that injustice of the kind described in this column is no perversion of the system; it is the system. Tony Blair came to power after assuring the City of his benign intentions. He then deregulated it and cut its taxes. Cameron didn’t have to assure it of anything: his party exists to turn its demands into public policy. Our ministers are not public servants. They work for the people who fund their parties, run the banks and own the newspapers, shielding them from their obligations to society, insulating them from democratic challenge.

    Our political system protects and enriches a fantastically wealthy elite, much of whose money is, as a result of their interesting tax and transfer arrangements, in effect stolen from poorer countries, and poorer citizens of their own countries. Ours is a semi-criminal money-laundering economy, legitimised by the pomp of the lord mayor’s show and multiple layers of defence in government. Politically irrelevant, economically invisible, the rest of us inhabit the margins of the system. Governments ensure that we are thrown enough scraps to keep us quiet, while the ultra-rich get on with the serious business of looting the global economy and crushing attempts to hold them to account.

    And this government? It has learned the lesson that Thatcher never grasped. If you want to turn this country into another Mexico, where the ruling elite wallows in unimaginable, state-facilitated wealth while the rest can go to hell, you don’t declare war on society, you don’t lambast single mothers or refuse to apologise for Bloody Sunday. You assuage, reassure, conciliate, emote. Then you shaft us.

    Article reproduced courtesy of The Guardian and George Monbiot

For FoCs Sake

Juliette Forrest: What does ‘Foc’ mean?
Rigby Reardon: It’s a slang word. When a man and a woman are in love, the man puts his…
Juliette Forrest: No, no. Here: “F. O. C.”

LAST UPDATED: 12.xii.11 (EoC)

In the spirit of the earlier, still in progress 50 People Who Buggered Up Britain – and to avoid, in these troubled times, a ball of anger seasoned with irritation and sprinkled with misanthropy gradually turning into a malignant growth somewhere in this fine body the Big Man was kind enough to lend me – I’ve decided to start a list of the Friends and Enemies of Carlotta. Feel free to suggest candidates for either…

Enemies of Carlotta

  • Corporation tax cheats: Google – they set the standards for taking no social responsibility in the territories they exploit, squeezing the most they can out of a morethansemi-monopolistic situation
  • Corporation tax cheats/duplicitous businesses: Kraft – manoeuvring to take a progressive, visionary Victorian business out of the tax regime of the country which created it – Cadbury’s secret Swiss move will cost UK exchequer millions in tax
  • Duplicitous individuals: Sepp Blatter – robbed £16M in broad Swiss daylight including the cash of hard-pressed city councils (looks like Morrison’s may take FIFA to court on this count in Switzerland)
  • Duplicitous individuals: Jack Warner – not the cozy cop from Dock Green but the corrupt cock from Trinidad & Tobago – see Corruption Charges “FIFA’s auditors Ernst & Young estimated Warner’s family made a profit of at least $1 million from reselling 2006 World Cup tickets that Warner had ordered. Minutes of FIFA’s executive committee indicate that a fine of almost $1 million, equal to the expected profiteering, was imposed on the family. Despite numerous reminders from FIFA, only $250,000 has been paid. // After Trinidad and Tobago visited Scotland for the friendly match on 30th May 2004  in Edinburgh, Jack Warner asked SFA President John McBeth for the cheque for the game to be made out to him personally and not to the FA of Trinidad and Tobago. McBeth refused to issue the cheque to Warner.”
  • Corporation tax cheats: Vodaphone – Watching the backlash from avoiding £6M of corporation tax #mademesmile – now people need to PAC a punch by moving their accounts away
  • Wayne Rooney and the England World Cup 2010 football team – didn’t even look like they gave a damn when they got knocked out, sorry shower
  • Rebekah Wade/Brooks – one can only hope she, Murdoch and the Sky deal get dragged down in the emerging News of the World phone hacking scandal to show how if you operate without morality with a bit of luck it eventually catches up with you (I know the world doesn’t work quite like that but we can dream) [22.i.11]
  • Caroline Spelman, so called Environment Secretary – someone remind her she’s supposed to be protecting the environment, not selling it alongside her own grandma
  • Brian Colemanfat cat councillor/London Assembly member, mummy’s boy, too grand to walk
  • Angela Knight, Chief Executive, British Bankers’ Association – excuses the inexcusable, especially around banking reform. I want my savings insulated from her members’ (in every sense) partially informed gambling.
  • Subway franchise – What the fuck is that smell?
  • Alain Rolland – What the fuck is that smell? The man who ruined the Rugby World Cup 2011 single-handedly (15.x.11)
  • Thierry Henry – he got a statue outside the Emirates last week (w/e 9/xii/11) but he should be remembered above all as a tricheur, the man who robbed Ireland of their place at the World Cup Finals in South Africa (even though it was one of the worst World Cups ever)
  • Colin Barrow, Leader of Westminster Council, who is pretending the proposed weekend and  evening parking charges in the borough are not motivated by revenue generation – perhaps he could start his money raising by paying back the money his hedge fund owes the council & Councillor Lee Rowley, cabinet member for parking and transport, some kind of moron with no experience worth talking of

Friends of Carlotta

  • Voina artists co-operative in Russia – taking on the KGB and corrupt police with Art
  • David Beckham – worthy (emotional and dignified) winner of BBC Sports Personality of 2010 Lifetime Achievement award – I was there when he was sent off against Argentina at St Etienne and how he came back not just as an even better footballer but as a very fine human-being
  • Gareth Bale – bringing long lost joy back to White Hart Lane (or White Hard Lane as I saw on a West End ticket booth yesterday)
  • Alastair Cook, cricketer/batsman – hero of the 2010-11 Ashes series in Oz with 766 runs to his name (with another innings still to play) and 189 today (5.1.11) to pretty much secure the victory
  • Magnus MacFarlane-Barrow, founder of Mary’s Meals, a Scottish charity which feeds and educates 460,000 children in developing countries every day.
  • Rolf Harris – what a lovely man – soon to feature as the Art Teacher in Jamie’s Dream School
  • more to follow
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