It's socialism for the rich, capitalism for the rest of us
Discussion
oyster said:
Rovinghawk said:
vonuber said:
Compare the billions lost through tax avoidance
How is it possible to 'lose' money to which the government was never legally entitled?A fair opinion, even if I disagree with it in practice.
Prawnboy said:
have those powers become law yet?
I believe "Accelerated Payment Notices" (APNs) are being drafted and _could_ be going out soon.Although with a General Election not a billion miles away you'd think any Govt letting those go out to our entrepreneurs (read 'employers' and voters as are their (potentially ex) employees...) would be a little wrong in the head.
Unless of course HMRC had become a law unto themselves...allegedly.
Oh well, as long as HMRC get more of our £s that all good...
turbobloke said:
It's not just coffee though, and apart from that, to a degree you now seem to be agreeing with the point I just made. The marketplace decides. Paper or pixel exercises carried out by armchair politicians based on personal moral judgements about lawful corporate strategy - that are only valid as far as the next person who disagrees - are (possibly) entertaining but that's all.
in this whole conversation i'm looking at the market, and looking at making it a fairer, level field in which a true healthy business can thrive & expand & create jobs and profits that benefit the individual, and by extension our country.i believe there is something more than soviet style socialism and multinational style capitalism.
The market place will of course decide, and information should inform any trading choice. If the market is given the information and decides to act upon that, (as it did in the starbucks case), this is good trade, nothing to worry about at all.
i happen to think that the offshore profit moving business model is not profitable for a healthy capitalist system.
tomw2000 said:
I believe "Accelerated Payment Notices" (APNs) are being drafted and _could_ be going out soon.
Although with a General Election not a billion miles away you'd think any Govt letting those go out to our entrepreneurs (read 'employers' and voters as are their (potentially ex) employees...) would be a little wrong in the head.
Unless of course HMRC had become a law unto themselves...allegedly.
Oh well, as long as HMRC get more of our £s that all good...
hopefully the impending election will kill that.Although with a General Election not a billion miles away you'd think any Govt letting those go out to our entrepreneurs (read 'employers' and voters as are their (potentially ex) employees...) would be a little wrong in the head.
Unless of course HMRC had become a law unto themselves...allegedly.
Oh well, as long as HMRC get more of our £s that all good...
Prawnboy said:
from the starbucks website....
In 2013 and 2014 Starbucks will not claim the tax deductions for royalties or payments related to our intercompany charges for interest and mark-up on the coffee we buy.
it's a start, whether it continues? we shall see.
i understand the idea of minimising liability for tax, personal and corporate and have no problem with it.
As for creating paper trails to offload profit into super low tax jurisdictions with no meaningful business operations? couldn't call that rightly so myself.
i know its legal, but so was slavery & child labour in this country once, both practises that benefited profit but were also unacceptable.
One problem with any discussion about tax is that most people do not know what they are talking about.In 2013 and 2014 Starbucks will not claim the tax deductions for royalties or payments related to our intercompany charges for interest and mark-up on the coffee we buy.
it's a start, whether it continues? we shall see.
i understand the idea of minimising liability for tax, personal and corporate and have no problem with it.
As for creating paper trails to offload profit into super low tax jurisdictions with no meaningful business operations? couldn't call that rightly so myself.
i know its legal, but so was slavery & child labour in this country once, both practises that benefited profit but were also unacceptable.
For example the Starbucks royalty is an allowable expense in most tax jurisdictions. So while Starbucks maybe reducing its UK tax bill using it UK companies will also be using it in other jurisdictions to move tax from their into the UK. If it was disallowed in the UK other jurisdiction may do the same which might mean a net fall in UK tax revenue.
As for transfer pricing. HMRC rules are very clear and goods/services can only move at market value. The risks and costs of trying to use this to move profit around the world is never worth it.
Prawnboy said:
turbobloke said:
It's not just coffee though, and apart from that, to a degree you now seem to be agreeing with the point I just made. The marketplace decides. Paper or pixel exercises carried out by armchair politicians based on personal moral judgements about lawful corporate strategy - that are only valid as far as the next person who disagrees - are (possibly) entertaining but that's all.
In this whole conversation i'm looking at the market, and looking at making it a fairer, level field in which a true healthy business can thrive & expand & create jobs and profits that benefit the individual, and by extension our country.
The marketplace decides; not you, not me, not Starbucks.
Prawnboy said:
The market place will of course decide
Only a line or two above, you were extolling interventionist Prawnboy Economics.Quite apart from that, your view of fairness is yours and while you're entitlted to it, there's no universal definition of 'fair'. Your version looks unfair from my perspective.
Ptawnboy said:
I believe there is something more than soviet style socialism and multinational style capitalism.
What is there, outside that continuum, which you're proposing?UK capitalism is hardly unregulated atm.
Mrr T said:
One problem with any discussion about tax is that most people do not know what they are talking about.
For example the Starbucks royalty is an allowable expense in most tax jurisdictions. So while Starbucks maybe reducing its UK tax bill using it UK companies will also be using it in other jurisdictions to move tax from their into the UK. If it was disallowed in the UK other jurisdiction may do the same which might mean a net fall in UK tax revenue.
As for transfer pricing. HMRC rules are very clear and goods/services can only move at market value. The risks and costs of trying to use this to move profit around the world is never worth it.
In reality though companies that use it move the money to a jurisdiction that has no business activity beyond a company name on an office door who on paper have the rights to the brand name. For example the Starbucks royalty is an allowable expense in most tax jurisdictions. So while Starbucks maybe reducing its UK tax bill using it UK companies will also be using it in other jurisdictions to move tax from their into the UK. If it was disallowed in the UK other jurisdiction may do the same which might mean a net fall in UK tax revenue.
As for transfer pricing. HMRC rules are very clear and goods/services can only move at market value. The risks and costs of trying to use this to move profit around the world is never worth it.
As for transfer pricing, starbucks UK (no profit) buys roasted beans from starbucks netherlands, (1% profit), they bought the raw beans from starbucks, switzerland, (no need to publish accounts). Seems they think it's worth moving the profits.
Stateless income tax planing.
turbobloke said:
Prawnboy said:
turbobloke said:
It's not just coffee though, and apart from that, to a degree you now seem to be agreeing with the point I just made. The marketplace decides. Paper or pixel exercises carried out by armchair politicians based on personal moral judgements about lawful corporate strategy - that are only valid as far as the next person who disagrees - are (possibly) entertaining but that's all.
In this whole conversation i'm looking at the market, and looking at making it a fairer, level field in which a true healthy business can thrive & expand & create jobs and profits that benefit the individual, and by extension our country.The marketplace decides; not you, not me, not Starbucks.
Prawnboy said:
The market place will of course decide
Only a line or two above, you were extolling interventionist Prawnboy Economics.Quite apart from that, your view of fairness is yours and while you're entitlted to it, there's no universal definition of 'fair'. Your version looks unfair from my perspective.
Ptawnboy said:
I believe there is something more than soviet style socialism and multinational style capitalism.
What is there, outside that continuum, which you're proposing?UK capitalism is hardly unregulated atm.
you love to pull the commie card but restriction of information & profiteering at the expense of the country are complete commie traits, so maybe these multinationals are the new red terror.
Prawnboy said:
in this whole conversation i'm looking at the market, and looking at making it a fairer, level field in which a true healthy business can thrive & expand & create jobs and profits that benefit the individual, and by extension our country.
It is obvious that transfer pricing and similar accounting 'tricks' offer multinationals a significant advantage over small local businesses. Personally I think this is a bad thing but the now almost identical British high streets suggest few others give a fvck. Unfortunately the EU is not about to change its trade laws so the answer is pretty simple IMO; lower UK corporation tax to the point where such accounting wheezes are no longer an advantage.Prawnboy said:
the only thing i have been extolling is information and transparency so the market can make informed decisions. What's controlling about that?
In which case I've been reading different posts to the ones you've been typing!It's not clear what information should be available that isn't, and what isn't transparent.
Your previous posts seemed to be about the potential to remove corporate tax avoidance avenues which you saw as somehow unfair - if that's wrong, do indicate - intervening in the market to engineer something that might be called Prawnboy Fairness.
Prawnboy said:
...you love to pull the commie card...
If the cap fits - I don't love it, sometimes it just seems right. fblm said:
Prawnboy said:
in this whole conversation i'm looking at the market, and looking at making it a fairer, level field in which a true healthy business can thrive & expand & create jobs and profits that benefit the individual, and by extension our country.
It is obvious that transfer pricing and similar accounting 'tricks' offer multinationals a significant advantage over small local businesses. Personally I think this is a bad thing but the now almost identical British high streets suggest few others give a fvck. Unfortunately the EU is not about to change its trade laws so the answer is pretty simple IMO; lower UK corporation tax to the point where such accounting wheezes are no longer an advantage.turbobloke said:
fblm said:
Prawnboy said:
in this whole conversation i'm looking at the market, and looking at making it a fairer, level field in which a true healthy business can thrive & expand & create jobs and profits that benefit the individual, and by extension our country.
It is obvious that transfer pricing and similar accounting 'tricks' offer multinationals a significant advantage over small local businesses. Personally I think this is a bad thing but the now almost identical British high streets suggest few others give a fvck. Unfortunately the EU is not about to change its trade laws so the answer is pretty simple IMO; lower UK corporation tax to the point where such accounting wheezes are no longer an advantage.As an aside I wonder if it has become easier or harder to build a national chain or mutinational? I suspect outside of 'tech' considerably harder. With all the 'will and skill' in the world, today, how the hell do you build a chain of stores to compete with the supermarkets, or amazon, or boots, or kwikfit etc... their buying power and logistical efficiency is simply untouchable in a way businesses wern't when they were being built.
Corporation tax is such a brilliant stealth tax half the idiots in the street want to pay more. Ultimately companies do not pay a penny in tax, they are just a conduit for taxing customers, employees and owners.
Prawnboy said:
In reality though companies that use it move the money to a jurisdiction that has no business activity beyond a company name on an office door who on paper have the rights to the brand name.
As for transfer pricing, starbucks UK (no profit) buys roasted beans from starbucks netherlands, (1% profit), they bought the raw beans from starbucks, switzerland, (no need to publish accounts). Seems they think it's worth moving the profits.
Stateless income tax planing.
Once again you are making things up with no knowledge of the subject. As for transfer pricing, starbucks UK (no profit) buys roasted beans from starbucks netherlands, (1% profit), they bought the raw beans from starbucks, switzerland, (no need to publish accounts). Seems they think it's worth moving the profits.
Stateless income tax planing.
All tax authorities are aware of the potential for moving profits using transfer pricing. UK tax law is clear transfers between group companies must be at a realistic market price. If you use an incorrect price and HMRC catch you they will assess you for any lose, if the transfer price was deliberately set incorrectly they can go back as many years as they want, and assess penalties of 100% of the tax lost.
Once the assessments are raised the benefit of the doubt is on the tax payer to prove the assessment is incorrect.
Transfer prices on commodities is easy to track. I will agree there is more leeway on inter group services or part finished good. But you can be sure HMRC will have discussed TP policy with every major UK company.
Using transfer pricing to move profits would be madness and no big company would take the risk.
turbobloke said:
It's not clear what information should be available that isn't, and what isn't transparent.
the profits of starbucks many EU businesses for example end up in switzerland where no company need declare information, (and as a side note, all the villainous scum, mafia & despots who hide money there, also need a light shone on them). turbobloke said:
Your previous posts seemed to be about the potential to remove corporate tax avoidance avenues which you saw as somehow unfair - if that's wrong, do indicate - intervening in the market to engineer something that might be called Prawnboy Fairness.
it's more about the potential of the market to decide if it feels this to be good practice.calling for transparency in the market is not engineering, it is giving everyone involved in that market the chance to make informed decisions. Those decisions will then decide how the market feels about buying from or investing in that company, be it on tax, moral, legal or profit grounds
turbobloke said:
If the cap fits - I don't love it, sometimes it just seems right.
as you will now just try and belittle any change to the status quo as a commie move, and try to make me out to be something i am plainly not i feel this discussion is over.fblm said:
It is obvious that transfer pricing and similar accounting 'tricks' offer multinationals a significant advantage over small local businesses. Personally I think this is a bad thing but the now almost identical British high streets suggest few others give a fvck. Unfortunately the EU is not about to change its trade laws so the answer is pretty simple IMO; lower UK corporation tax to the point where such accounting wheezes are no longer an advantage.
Please read my above post on transfer pricing.In my experience small companies are far more likely to be involved in tax avoidance/evasion than large companies.
In large companies most decisions are made by a group of people any of whom may leave the company to work for a competitor. With any group the risk of leaks is much higher. Further those people only incentive is a higher salary and bonus.
In small companies the decision to evade/avoid tax will normally rest with a very limited number (often one) of people who are likely to benefit personally from the tax saved.
Mrr T said:
Please read my above post on transfer pricing.
In my experience small companies are far more likely to be involved in tax avoidance/evasion than large companies.
In large companies most decisions are made by a group of people any of whom may leave the company to work for a competitor. With any group the risk of leaks is much higher. Further those people only incentive is a higher salary and bonus.
In small companies the decision to evade/avoid tax will normally rest with a very limited number (often one) of people who are likely to benefit personally from the tax saved.
I understand transfer pricing fine, I think. I don't have a problem with transparent transfers like commodity costs and in any event the prevalence of small business tax evasion is irrelevant to the discussion, perhaps if you reduced CT there would be less of it! The cost of coffee beans is negligible compared to the countless billions of intellectual property washed through arrangements like the 'double irish' and 'dutch sandwich'. Thanks to the EU such accounting tricks are going nowhere though so IM-non accountant-O the only way to 'level the playing field' is to lower CT for everyone else. In my experience small companies are far more likely to be involved in tax avoidance/evasion than large companies.
In large companies most decisions are made by a group of people any of whom may leave the company to work for a competitor. With any group the risk of leaks is much higher. Further those people only incentive is a higher salary and bonus.
In small companies the decision to evade/avoid tax will normally rest with a very limited number (often one) of people who are likely to benefit personally from the tax saved.
Mrr T said:
Prawnboy said:
In reality though companies that use it move the money to a jurisdiction that has no business activity beyond a company name on an office door who on paper have the rights to the brand name.
As for transfer pricing, starbucks UK (no profit) buys roasted beans from starbucks netherlands, (1% profit), they bought the raw beans from starbucks, switzerland, (no need to publish accounts). Seems they think it's worth moving the profits.
Stateless income tax planing.
Once again you are making things up with no knowledge of the subject. As for transfer pricing, starbucks UK (no profit) buys roasted beans from starbucks netherlands, (1% profit), they bought the raw beans from starbucks, switzerland, (no need to publish accounts). Seems they think it's worth moving the profits.
Stateless income tax planing.
All tax authorities are aware of the potential for moving profits using transfer pricing. UK tax law is clear transfers between group companies must be at a realistic market price. If you use an incorrect price and HMRC catch you they will assess you for any lose, if the transfer price was deliberately set incorrectly they can go back as many years as they want, and assess penalties of 100% of the tax lost.
Once the assessments are raised the benefit of the doubt is on the tax payer to prove the assessment is incorrect.
Transfer prices on commodities is easy to track. I will agree there is more leeway on inter group services or part finished good. But you can be sure HMRC will have discussed TP policy with every major UK company.
Using transfer pricing to move profits would be madness and no big company would take the risk.
starbucks pay 6% to a swiss subsidiary for brand rights, this reduces profits.
they also buy coffee through 2 subsidiary's, who mark-up, (within commodity prices). each mark up is reducing profit in the jurisdiction before.
finally the business has debt to pay inc interest on money it lent itself via the swiss subsidury, reducing profit.
to me reducing profit in one subsidiary with higher tax to increase profit in another juristiction with lower tax is moving profit.
what am i failing to see.
Prawnboy said:
as you will now just try and belittle any change to the status quo as a commie move, and try to make me out to be something i am plainly not i feel this discussion is over.
Claiming something doesn't make it so, disagreement within this thread has been robust but cordial as far as I can see.There are options available to successful small businesses, including the option to expand and become a bigger multinational business if the will and skill are there - as pointed out earlier. If a business owner or management team realise there is neither the will and/or neither the skill, it's not an unfairness if another company goes ahead and succeeds on a multinational platform on which other processes come into play.
fblm said:
turbobloke said:
fblm said:
Prawnboy said:
in this whole conversation i'm looking at the market, and looking at making it a fairer, level field in which a true healthy business can thrive & expand & create jobs and profits that benefit the individual, and by extension our country.
It is obvious that transfer pricing and similar accounting 'tricks' offer multinationals a significant advantage over small local businesses. Personally I think this is a bad thing but the now almost identical British high streets suggest few others give a fvck. Unfortunately the EU is not about to change its trade laws so the answer is pretty simple IMO; lower UK corporation tax to the point where such accounting wheezes are no longer an advantage.fblm said:
As an aside I wonder if it has become easier or harder to build a national chain or mutinational? I suspect outside of 'tech' considerably harder. With all the 'will and skill' in the world, today, how the hell do you build a chain of stores to compete with the supermarkets, or amazon, or boots, or kwikfit etc... their buying power and logistical efficiency is simply untouchable in a way businesses wern't when they were being built.
Equally information, communication, other service tech and mobility are in a different league these days. It's a good question to ask, but without the will and the skill it'll never be answered in practice that's for sure 
fblm said:
Corporation tax is such a brilliant stealth tax half the idiots in the street want to pay more...
Nicely put!pteron said:
I tried to read it. But by the time I get to about a third in I realise that life is too short to read such juvenile carp.
It's simplistic, one dimensional twaddle.
Life is far too complex to reduce to 'libertarian or communist'.
So you haven't read it and prefer to use other peoples opinion, fair enough, though it's no more simplistic than 1984 or Brave New World. It is not as good a read as Fountainhead (which is probably much closer to a real world than Atlas Shrugged) as it really is meant as a way to illustrate Rands philosophy of objectivism. Of course life is far more complex than libertarian vs communist (collectivist to use Rand terminology) but does give some very useful insight into how the collectivists think and operate. Ironically had you read it you would see quite a lot of what OJ complains about well illustrated in the book.It's simplistic, one dimensional twaddle.
Life is far too complex to reduce to 'libertarian or communist'.
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