Tax Avoidance = Immoral
Discussion
turbobloke said:
Going bankrupt - yes maybe if the level of public sector waste was endemic in the private sector, but it's not. .
Think you miss my point somewhat. If private sector firms were the bastions of efficiency some people assume them to be they wouldn't be going bankrupt as often as they do.Countdown said:
turbobloke said:
Going bankrupt - yes maybe if the level of public sector waste was endemic in the private sector, but it's not. .
Think you miss my point somewhat. If private sector firms were the bastions of efficiency some people assume them to be they wouldn't be going bankrupt as often as they do.You assume that what you call corporate bankruptcies arise cost-side due to inefficiency rather than external factors such as rents, also rather than from the income side in terms of significant reductions in the level of trade or delays in invoice payment.
What gives you the idea that lack of control of waste and general inefficiency is in any way largely responsible? Business failures occur due to liquidity problems, solvency issues (current ratio measure), and viability (lack of) as an indicator of liquidity and solvency in terms of profitability over time.
Given the nature of operating a private sector business, efficiency is a constant area for review - given the nature of public sector operations with a largely captive customer audience and virtually guaranteed source of funding via taxation, the imperative is far less.
Did you say you had owned and/or run a business? If it's a question too far in terms of your preferred privacy level I appreciate you won't answer and would understand that.
Also check out this other thread recently started by heppers75.
http://www.pistonheads.com/gassing/topic.asp?h=0&a...
http://www.pistonheads.com/gassing/topic.asp?h=0&a...
fbrs said:
crankedup said:
and whilst it seems, but is most likely just a propagation from the media, that young gullible people consider success to be only reaching the dizzy heights of 'fame'. We are a shallow narrow minded society, greed orientated ready to 'do it over' anyone if it means a profit. I am just thankful that I made an exit to the rat race years back.
edit to add : I don't think final pension salaries are offered as an option now, if it were so he would have jumped in with that.
Edited by crankedup on Tuesday 26th June 11:43
johnfm said:
crankedup said:
turbobloke said:
johnfm said:
Countdown said:
johnfm said:
You forgot Honk Kong, Singapore, BVI etc in your list Eric.
If they are taking less in tax then they will be providing less in services. It's a zero sum game.Would be interesting to know how many care homes they provide for the Elderly
I think if the 'waste' term is reduced, the 'Services' term can stay the same, while Tax Take and Borrowing go down.
Size and scope of state down = more savings.
Clegg and Miliband won't get any of that. CMD just might.
Edited by crankedup on Monday 25th June 19:55
In fact, you could get by with about 60: 20 in the Cabinet, 20 shadow cabinet and 20 floaters. A majority vote with 600 or 60 is pretty much the same. They do, afterall, have a veritable army of civil servants - thousands of them.
Then there is the armed forces procurement & logistics. Tens of thousands. Nearly as many in procurement as front line troops.
The NHS employs over 1 million clinical staff. For a population of 65 million!
Pension provision for upper level Civil Servants and NHS staff: £40k+ pensions with 10% or so contribution? Unaffordable.
Swathes of translators for the courts and the NHS? Spend that money TEACHING newly minted UK citizens to read and speak English. Encourage this by not spending further millions translating everything into 20 languages.
I think there is plenty of low hanging fruit, before we even get to no child benefit after 2 kids, smaller caps on HB (to be augmented by a couple of related schemes - house building and renovation in cities to provide more housing, means/needs testing of all council house recipients so people who move up the career ladder get their own housing, and an incentive of reduced corporation tax for companies who pay a 'living wage' so that HB is not as necessary for working people).
I am pretty sure that the £700 bio/year spend can be cut.
The safety net is important for society - but the hammock has to go.
I wish to see an end to Trident, thats my number one wish.
Agree benefits are way out of line now. Both our siblings moan like crazy about how hard they work and see others lolling around doing nothing and being given fistfuls of cash from the Government. Its a good analogy 'the hammock must go but retain a decent safety net'.
Having used the NHS hospital service recently I cannot be convinced of a case for reducing clinical staff. Managerial staff? I don't know.
However, pre-supposing that many thousands of jobs will be axed in the coming two/three years I imagine these people will end up unemployed due to the current jobs situation.
Of course I am one of the few left of centre posters in here, but even I recognise the changes that have to be made, painful as they are to be.
crankedup said:
For decades various Governments have talked the talk regards cutting back public expenditure, ends up a bit of fiddling around the margins generally. ...
Having used the NHS hospital service recently I cannot be convinced of a case for reducing clinical staff. Managerial staff? I don't know....
Here's the problem the various governments have though. Having used the NHS hospital service recently I cannot be convinced of a case for reducing clinical staff. Managerial staff? I don't know....
Even the "left of centre" know cuts need to be made. But there is nothing material they (or anyone else for that matter it seems) are prepared to cut.
Trident is as much fiddling round the edges as child benefit, uni fees or any of the other nonsense. Wholesale cuts in all the things many hold dear are needed. But as a nation we don't appear to have the stomach for it.
We need to stop arsing about.
- pensions : stop all final salary schemes and move to a more commercial footing. Starting with the MPs.
- health : strip the NHS back to an emergency service only. Cut right into it.
- benefits : come up with an alternative to cash handouts. Give people the bare minimum needed to get along (which does not involve Xboxes, Sky, cigarettes and booze).
- education : free pre-school trial? WTF are you doing you mongs. We need to cut money, not spend more.
- bloated government : cut numbers radically. Simplify the whole system of government (HMRC being a good example).
- etc
All of these things need to happen in unison so that you don't get the "you can't do x because I'd be better off with y" bulls
t.We either grasp the nettle or be subject to perpetual fiddling around the edges and eventually a situation just like Greece.
Entirely correct but unlikely to happen. Certainly not with the coalition as it is. The reality of their actual ability to make real changes is about Zero. Cameron is a Public Relations man through and through. I am sorry to say he could happily be in a government with Tony Blair. Call me Dave and Call me Tony are suggested phrases out of the same PR manual.
They are I fear blood brothers, both born with a silver spoon in their mouths, both attended major public schools, both went into University and then into politics. Both focused on self promotion and self aggrandisment and both married to successful well placed wives. I have to say I could not stomach the awful Mrs Blair, AKA Cherie Booth. At least Cameron's wife looks human. Mind you looks can be deceptive, as I know to my cost five times over.
I would suggest at least a period of at least five years, before the disastrous consequences of the failure of governments not curbing their spending begin to penetrate the minds and actions of UK politicians. The defaulting European states will begin the process. Learning the lesson will take time. Probably in the time of the next government but one.
For more than 50 years UK politicians have become more and more wedded to the philosophy of buying votes with big benefit payments and running completely artificial job creation schemes all paid for by the taxpayer, to keep the massive number of unemployed voters onside and their own jobs safe. It has become the mantra of all politicians in the UK parliament.
Nothing will change until, finally, as the dreadful devastation that occurs in the defaulters within Europe, becomes totally apparent, as they collapse into insolvency, chills the minds of our idiots in charge and only then will there be action. Fear of catastrophic failure is what is needed and until then, there will just be rhetoric by the bucket and no action. 50 years of learned behaviour takes some shifting in animals as dim and self serving as our politicians.
But we will get there. It is just possible that with a big enough shift in the ludicrous overspending that now exists within the UK, the UK could actually restore its economic balance and allow the country to gradually lift itself out of the hole dug by our politicians over the last 50 years, with their ever increasing self service. I hope I an alive to see it. It could offer a real future to our youngsters, which successive government policies over the previous half century most certainly have not.
They are I fear blood brothers, both born with a silver spoon in their mouths, both attended major public schools, both went into University and then into politics. Both focused on self promotion and self aggrandisment and both married to successful well placed wives. I have to say I could not stomach the awful Mrs Blair, AKA Cherie Booth. At least Cameron's wife looks human. Mind you looks can be deceptive, as I know to my cost five times over.
I would suggest at least a period of at least five years, before the disastrous consequences of the failure of governments not curbing their spending begin to penetrate the minds and actions of UK politicians. The defaulting European states will begin the process. Learning the lesson will take time. Probably in the time of the next government but one.
For more than 50 years UK politicians have become more and more wedded to the philosophy of buying votes with big benefit payments and running completely artificial job creation schemes all paid for by the taxpayer, to keep the massive number of unemployed voters onside and their own jobs safe. It has become the mantra of all politicians in the UK parliament.
Nothing will change until, finally, as the dreadful devastation that occurs in the defaulters within Europe, becomes totally apparent, as they collapse into insolvency, chills the minds of our idiots in charge and only then will there be action. Fear of catastrophic failure is what is needed and until then, there will just be rhetoric by the bucket and no action. 50 years of learned behaviour takes some shifting in animals as dim and self serving as our politicians.
But we will get there. It is just possible that with a big enough shift in the ludicrous overspending that now exists within the UK, the UK could actually restore its economic balance and allow the country to gradually lift itself out of the hole dug by our politicians over the last 50 years, with their ever increasing self service. I hope I an alive to see it. It could offer a real future to our youngsters, which successive government policies over the previous half century most certainly have not.
Edited by Steffan on Tuesday 26th June 16:00
crankedup said:
fbrs said:
crankedup said:
and whilst it seems, but is most likely just a propagation from the media, that young gullible people consider success to be only reaching the dizzy heights of 'fame'. We are a shallow narrow minded society, greed orientated ready to 'do it over' anyone if it means a profit. I am just thankful that I made an exit to the rat race years back.edit to add : I don't think final pension salaries are offered as an option now, if it were so he would have jumped in with that.
If Vodafone paid what HMRC demanded, how have they evaded tax? If they didn't pay up or only paid part of their dues then that would be evasion.
Then source quoted appears to be the one also saying this:
"It may be legal, but it's completely immoral."
"There is no suggestion the company has behaved unlawfully, and arranging its affairs in a tax-efficient manner within the law is standard business practice."
The issue of morality in terms of paying too much tax also needs looking at.
Then source quoted appears to be the one also saying this:
"It may be legal, but it's completely immoral."
"There is no suggestion the company has behaved unlawfully, and arranging its affairs in a tax-efficient manner within the law is standard business practice."
The issue of morality in terms of paying too much tax also needs looking at.
Edited by turbobloke on Tuesday 26th June 21:08
coyft said:
I'm sick of it to be honest, corporates doing deals with HMRC whilst our Eton educated PM tells us it's immoral for citizens to mitigate their own tax bill.
Like I say, I am waiting for someone to investigate just how much Cameron and his parents/in-laws pay in tax........ "Any one may so arrange his affairs that his taxes shall be as low as possible; he is not bound to choose that pattern which will best pay the Treasury; there is not even a patriotic duty to increase one's taxes."
Judge Learned Hand, Helvering v. Gregory, 69 F.2d 809, 810-11 (2d Cir. 1934).
The above quote from an aptly named American judge sums up the situation very well over here as well. The concept of moral duty only arises through reasoning by assertion to support a particular viewpoint. There's nothing moral about overpaying in general and there's nothing immoral about paying the lawful amount of tax.
Judge Learned Hand, Helvering v. Gregory, 69 F.2d 809, 810-11 (2d Cir. 1934).
The above quote from an aptly named American judge sums up the situation very well over here as well. The concept of moral duty only arises through reasoning by assertion to support a particular viewpoint. There's nothing moral about overpaying in general and there's nothing immoral about paying the lawful amount of tax.
But there is a lot of immorality carried out by tax advisers who falsely sell a tax reduction scheme to their clients for a large fee on the basis that the scheme is "legal" even when no such ruling on its legality has ever been made.
The immorality is compounded when the tax advisers bear no financial responsibility or risk whemn the taxpayer subsequently has to pay underpaiod tax and penalties and interest.
I blame the accountants.
The immorality is compounded when the tax advisers bear no financial responsibility or risk whemn the taxpayer subsequently has to pay underpaiod tax and penalties and interest.
I blame the accountants.
Eric Mc said:
But there is a lot of immorality carried out by tax advisers who falsely sell a tax reduction scheme to their clients for a large fee on the basis that the scheme is "legal" even when no such ruling on its legality has ever been made.
The immorality is compounded when the tax advisers bear no financial responsibility or risk whemn the taxpayer subsequently has to pay underpaiod tax and penalties and interest.
I blame the accountants.
I entirely agree Eric, the Pontius Pilot approach, to use a biblical analogy, and refusal from the start to offer any form of guarantee or support if the proposed method proves to be flawed, which it will, is wrong from the start. I also blame the accountants concerned., The immorality is compounded when the tax advisers bear no financial responsibility or risk whemn the taxpayer subsequently has to pay underpaiod tax and penalties and interest.
I blame the accountants.
The case that does give some succour to tax planning in the UK, is the IRC v Duke of Westminster ([1936] 19 TC 490), which produced the comment from a very senior judge, Lord Tomalin, that:
"Every man is entitled, if he can, to order his affairs so that the tax attaching under the appropriate Acts is less than it otherwise would be".
But the subsequent Ramsay case and others steadily outlawed the use of any artificial device or non commercial mechanism, to the point where, I think, this scheme is dead in the water, and was obviously so from the start.
Tax planning in the UK cannot involve clear mechanisms which are obviously nit commercially driven and therefore designed to avoid tax first and foremost. Which this mechanism clearly does.
Eric Mc said:
But there is a lot of immorality carried out by tax advisers who falsely sell a tax reduction scheme to their clients for a large fee on the basis that the scheme is "legal" even when no such ruling on its legality has ever been made.
The immorality is compounded when the tax advisers bear no financial responsibility or risk whemn the taxpayer subsequently has to pay underpaiod tax and penalties and interest.
I blame the accountants.
I assume the clients are fully aware of the fee structure, the risk of HMRC declaring the scheme void and the risk of non refundable fees they pay to the accountants.The immorality is compounded when the tax advisers bear no financial responsibility or risk whemn the taxpayer subsequently has to pay underpaiod tax and penalties and interest.
I blame the accountants.
With all this information they decide whether or not to appoint these accountants. I don't blame the accountants or the clients. They are all adults and choose to contract or not.
johnfm said:
I assume the clients are fully aware of the fee structure, the risk of HMRC declaring the scheme void and the risk of non refundable fees they pay to the accountants.
With all this information they decide whether or not to appoint these accountants. I don't blame the accountants or the clients. They are all adults and choose to contract or not.
Hmmm - I wouldn't assume that the clients were/are fully aware at all.With all this information they decide whether or not to appoint these accountants. I don't blame the accountants or the clients. They are all adults and choose to contract or not.
It's amazing how effective a good sales pitch can be.
I make no apologies for posting another article from Accounting Web. Rebecca Benneyworth is someone for whom I have an awful lot of time. I've attended quite a few of her lectures over the years.
Tax avoidance: the reputational damage to our profession
Posted by Rebecca Benneyworth 26/06/12
I suspect that the accountancy and tax profession will look back on June 2012 with mixed feelings, says Rebecca Benneyworth MBE.
The campaign by The Times newspaper obviously started some time ago, as it would take a little time to build up such a body of material on the various aspects of tax avoidance that the newspaper sought to bring to the public’s attention.
Some will be pleased that this thorny issue has been aired, and in spite of a fair bit of hot air last week, what the paper did manage to do was convey the outline of some quite complex avoidance schemes in an intelligible way. So my first stop is to congratulate those journalists who must have spent many long hours researching and trying to understand some of the schemes.
In the early part of the week I was most concerned about the reputational damage to the accountancy and tax profession. I do not want to hear the word “accountant” be spoken with a sneer by the wider public; I dread the profession being labelled with the same sort of tag as “ambulance chasing” claims handlers. We have studied hard and hold high professional standards, and it does no good for the wider public to see us as grasping or cheating (or at least enabling and supporting that behaviour by our clients). We have an extremely important role to play, both as business advisers, and in assisting in the day-to-day delivery of the tax system, whether through Self Assessment, or by supporting a very wide range of businesses with their tax obligations – VAT, payroll etc. which without doubt they would not be able to manage unaided. The tax authority does not have the staff or expertise to take this task on.
We also have a role to play in supporting the government to bring forward good and workable tax legislation. We can only keep up the pressure on that score – and sometimes we are heard, and sometimes we are not. So I am very concerned about the reputational damage to our profession as this could take years to repair – if public perception of us can be restored.
I have so far resisted the “M” word. Last week gave me time to think about the moral issues, and on reflection I have changed my stance. It is not my (or indeed anyone else’s job) to make moral judgements about my clients. Provided they behave within the law, and do not conceal income that is taxable I can do my job. The moral issue is a personal one. It is for everyone to consider whether, in times of national hardship, with families going hungry and losing their homes, it is right to seek to avoid tax in the ways that have been publicised. We have an example in that one individual, when challenged, and on reflection, decided that this was not an appropriate way to behave.
This does not mean that I have changed my approach to tax avoidance. It is not an area I intend to advise on, and I have no intention of ever getting involved in any of it. I would advise clients considering seeking advice about some of these schemes that they rarely work or rarely work for long, can end up costing an awful lot of money to get out of, and “mark your card” with HMRC, who must take account of that behaviour in any risk assessment they make.
So what should be the upshot of last week’s coverage? I believe that HMRC must redouble its efforts to get all of the schemes closed down – either through specific legislation or a GAAR (which is of course due next year). But it goes further than this. The tax authority must also apply resources to following up every case where tax avoidance schemes have been implemented to ensure that any outstanding tax due is collected. Those who have failed to implement the scheme properly should be pursued relentlessly. Schemes that have not worked should be identified and all of those implementing them should be promptly approached to collect the tax that is due.
So the light shines too on an under-resourced tax authority struggling to identify where to best apply their efforts. I suspect that last week has just pushed one area a bit higher up the agenda – and a good thing too
fbrs said:
crankedup said:
fbrs said:
crankedup said:
and whilst it seems, but is most likely just a propagation from the media, that young gullible people consider success to be only reaching the dizzy heights of 'fame'. We are a shallow narrow minded society, greed orientated ready to 'do it over' anyone if it means a profit. I am just thankful that I made an exit to the rat race years back.edit to add : I don't think final pension salaries are offered as an option now, if it were so he would have jumped in with that.
johnfm said:
I can only go by personal experience.
The two times schemes like this have been promoted to me, the risks and the non refundable fees were laid out clearly - but no doubt some accountants are sharks.
Tax can be incredibly complex, I flirted with a film investment scheme some years ago and found it extremely hard to understand. At no point was there a conversation about legality or it not being approved. Quite how the archetypal footballer might comprehend it is a mystery. The two times schemes like this have been promoted to me, the risks and the non refundable fees were laid out clearly - but no doubt some accountants are sharks.
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