Discussion
Breadvan72 said:
Governments are partly to blame for encouraging a business culture that exploits low paid workers.
Given that there are so many hundreds of millions of people around the world receiving less than a $1 a day, any case for higher paid workers in some countries can only be built on sandhavoc said:
Not true
Where the output is readily exportable (e.g. textiles) then you have a point. But where it is difficult to transport (e.g. bulk, perishable...), difficult to export (regulations, desire for proximity...), or requires a face-to-face service (restaurants, taxis...), then it doesn't apply - straightforward supply and demand, where the barriers to entry on supply prevent imports.
You also need to look at the cost of living in the respective countries - the argument "I should only pay you $1 a day because that's the average wage in the Democratic Republic of Somewherestan" is utterly fallacious if the typical cost of housing in DRS is $0.20 a day, vs e.g. $25 a day in the UK.
Foundations on sand right there.Where the output is readily exportable (e.g. textiles) then you have a point. But where it is difficult to transport (e.g. bulk, perishable...), difficult to export (regulations, desire for proximity...), or requires a face-to-face service (restaurants, taxis...), then it doesn't apply - straightforward supply and demand, where the barriers to entry on supply prevent imports.
You also need to look at the cost of living in the respective countries - the argument "I should only pay you $1 a day because that's the average wage in the Democratic Republic of Somewherestan" is utterly fallacious if the typical cost of housing in DRS is $0.20 a day, vs e.g. $25 a day in the UK.
The cost differential drives innovation to close the gaps you point to: bulk - build bigger ships to reduce costs; perishable- develop improved preservation; regulations - lobby for deregulation etc.
Cost of living argument is more durable, but still falls down. In the uk, for instance, by the taxpayer contributing (tax credits etc) to subsidise wages and housing costs, artificially maintaining the gap
Fundamentally, when the capability and desire exists to do a job for £1, anyone expecting £100 for the same job needs to work harder to maintain that gap than the body charging £1 needs to work to close the gap.
Doesn't happen overnight, just as houses built on sand don't fall down overnight.
Maugham has now appealed HMRC's decision not to allow him to claim back the VAT on the Uber journey that he is using in this case
https://goodlawproject.org/uber-appeal-tax-tribuna...
He is using George Peretz QC and Brendan McGurk of Monckton Chambers
https://goodlawproject.org/uber-appeal-tax-tribuna...
He is using George Peretz QC and Brendan McGurk of Monckton Chambers
A press release on the ruling by the CJEU that will give Maugham further cheer in respect of his case
https://curia.europa.eu/jcms/upload/docs/applicati...
"The service provided by Uber connecting individuals with non-professional drivers is covered by services in the field of transport"
Key section (imo)
The Court takes the view, first of all, that the service provided by Uber is more than an intermediation service consisting of connecting, by means of a smartphone application, a nonprofessional driver using his or her own vehicle with a person who wishes to make an urban journey. Indeed, in this situation, the provider of that intermediation service simultaneously offers urban transport services, which it renders accessible, in particular, through software tools and whose general operation it organises for the benefit of persons who wish to accept that offer in order to make an urban journey. The Court notes in that regard that the application provided by Uber is indispensable for both the drivers and the persons who wish to make an urban journey. It also points out that Uber exercises decisive influence over the conditions under which the drivers provide their service.
Therefore, the Court finds that that intermediation service must be regarded as forming an integral part of an overall service whose main component is a transport service and, accordingly, must be classified not as ‘an information society service’ but as ‘a service in the field of transport’.
ETA that Maugham is indeed trumpeting this as support to his case
https://twitter.com/JolyonMaugham/status/943404928...
Moreover (and more interestingly) he claims to now have direct evidence of why HMRC is failing to apply the law to some US MNCs and that he expects to be in a position to release that evidence shortly.
https://twitter.com/JolyonMaugham/status/943407199...
https://curia.europa.eu/jcms/upload/docs/applicati...
"The service provided by Uber connecting individuals with non-professional drivers is covered by services in the field of transport"
Key section (imo)
The Court takes the view, first of all, that the service provided by Uber is more than an intermediation service consisting of connecting, by means of a smartphone application, a nonprofessional driver using his or her own vehicle with a person who wishes to make an urban journey. Indeed, in this situation, the provider of that intermediation service simultaneously offers urban transport services, which it renders accessible, in particular, through software tools and whose general operation it organises for the benefit of persons who wish to accept that offer in order to make an urban journey. The Court notes in that regard that the application provided by Uber is indispensable for both the drivers and the persons who wish to make an urban journey. It also points out that Uber exercises decisive influence over the conditions under which the drivers provide their service.
Therefore, the Court finds that that intermediation service must be regarded as forming an integral part of an overall service whose main component is a transport service and, accordingly, must be classified not as ‘an information society service’ but as ‘a service in the field of transport’.
ETA that Maugham is indeed trumpeting this as support to his case
https://twitter.com/JolyonMaugham/status/943404928...
Moreover (and more interestingly) he claims to now have direct evidence of why HMRC is failing to apply the law to some US MNCs and that he expects to be in a position to release that evidence shortly.
https://twitter.com/JolyonMaugham/status/943407199...
Edited by anonymous-user on Wednesday 20th December 09:11
He hasn’t yet revealed the evidence he has which he claims shows why HMRC appears to some to be lax on taxing mncs
The update does address why HMRC should make Uber it’s sixth attempt at a principal vs agent tax liability case (having lost the previous five)
And why HMRC could (& should) raise a protective assessment on the potential vat liability that might arise
It is clear that Maugham has the ear of members of the PAC and, in his role, he will have regular contact with HMRC staff and officials
I expect he will, one way or another, get this in front of a court or tax tribunal in 2018.
Let’s see
The update does address why HMRC should make Uber it’s sixth attempt at a principal vs agent tax liability case (having lost the previous five)
And why HMRC could (& should) raise a protective assessment on the potential vat liability that might arise
It is clear that Maugham has the ear of members of the PAC and, in his role, he will have regular contact with HMRC staff and officials
I expect he will, one way or another, get this in front of a court or tax tribunal in 2018.
Let’s see
You asked the same question many pages back. Here is the answer I gave then. It hasn't changed.
"At the risk of repeating myself (again), I am interested in why it is taking a private prosecution to get the question of a potential several hundred million pound VAT liability looked at.
That it is Uber that is involved is of no real interest to me.
That it isn't HMRC that is being seen to be asking the question is of great interest to me"
"At the risk of repeating myself (again), I am interested in why it is taking a private prosecution to get the question of a potential several hundred million pound VAT liability looked at.
That it is Uber that is involved is of no real interest to me.
That it isn't HMRC that is being seen to be asking the question is of great interest to me"
I have a particularly unhealthy interest in vat just now. I could blame a talk by Rita de la Feria for initially piquing my interest, but that would be unfair on her.
HMRC’s willingness to come down like a tonne of bricks (rightly) on uk traders for any breach (intentionally or by accident) of the staggeringly complex legislation, whilst seemingly allowing, eg Uber, to avoid scrutiny and for non uk online sellers to seemingly just ignore vat liabilities entirely
HMRC’s willingness to come down like a tonne of bricks (rightly) on uk traders for any breach (intentionally or by accident) of the staggeringly complex legislation, whilst seemingly allowing, eg Uber, to avoid scrutiny and for non uk online sellers to seemingly just ignore vat liabilities entirely
Indeed, that was mentioned on this thread previously
I read the tribunal reports on a couple of the HMRC failures and can understand their reluctance to some extent. But I can see the argument that says Uber is different enough to warrant another look too
Maugham touches in it in his latest update (linked above)
I read the tribunal reports on a couple of the HMRC failures and can understand their reluctance to some extent. But I can see the argument that says Uber is different enough to warrant another look too
Maugham touches in it in his latest update (linked above)
Here is Maugham substantiating the claim he made previously that he had evidence that suggested that HMRC demonstrates a lax attitude towards the taxation of multinationals
https://waitingfortax.com/2018/01/23/dont-be-too-h...
"The link below is to an extract from a covertly recorded 70 minute conversation between Guy Westhead, a senior member of HMRC’s team dealing with VAT policy, and a Mr Richard Allen that took place in late 2015."
https://waitingfortax.com/2018/01/23/dont-be-too-h...
"The link below is to an extract from a covertly recorded 70 minute conversation between Guy Westhead, a senior member of HMRC’s team dealing with VAT policy, and a Mr Richard Allen that took place in late 2015."
Here is the latest update, described as 'rather punchy' by Maugham
https://goodlawproject.org/uber-hmrcs-position/
Included is a link to HMRC's Statement of Case for the FTT case
https://d2l6cjylzkj2qa.cloudfront.net/wp-content/u...
The summary of which is that HMRC contends that Maugham's appeal should be dismissed as it can only focus on the very narrow issue of whether the information Maugham supplied supporting his claim for a VAT repayment met the necessary threshold (and that it didn't)
From which Maugham highlights
18. It cannot, or should not, be inferred from the Letter, as the Appellant seeks to in paragraphs 12 and 13 of the GoA, that HMRC must have reached a decision on the VAT chargeable on the Supply.
19. Thus, in so far as the Appellant seeks to pursue an appeal on a matter within s83(1)(b) VATA, that part of its appeal is misconceived as it is not an appeal based on any decision actually given by HMRC to the Appellant. HMRC have taken no decision on the VAT chargeable on the Supply.
and suggests that is flatly inconsistent with the evidence given by Jim Harra to the PAC (linked previously)
Maugham concludes
"The Statement of Case pretends the situation is otherwise. It pretends that HMRC have not decided whether Uber is chargeable to input tax. And it embarks on that pretence because it wants to escape independent judicial scrutiny of its decision. There is, on the evidence, simply no other explanation.
There is no good explanation for why HMRC might adopt a position that leads to a loss of tax of, by our calculations, around £200 million per year. And in the absence of a good explanation you are compelled to a bad one. Last week direct evidence emerged that HM Treasury does put HMRC under pressure to go easy on other large US multinationals. We cannot identify any alternative candidate explanation that is consistent with the facts.
We will reply – likely next week – to HMRC and the specialist tax Tribunal making these points. And we will invite the Tribunal to refuse to allow itself to be used to advance what, on the evidence, looks to be a simple ruse."
https://goodlawproject.org/uber-hmrcs-position/
Included is a link to HMRC's Statement of Case for the FTT case
https://d2l6cjylzkj2qa.cloudfront.net/wp-content/u...
The summary of which is that HMRC contends that Maugham's appeal should be dismissed as it can only focus on the very narrow issue of whether the information Maugham supplied supporting his claim for a VAT repayment met the necessary threshold (and that it didn't)
From which Maugham highlights
18. It cannot, or should not, be inferred from the Letter, as the Appellant seeks to in paragraphs 12 and 13 of the GoA, that HMRC must have reached a decision on the VAT chargeable on the Supply.
19. Thus, in so far as the Appellant seeks to pursue an appeal on a matter within s83(1)(b) VATA, that part of its appeal is misconceived as it is not an appeal based on any decision actually given by HMRC to the Appellant. HMRC have taken no decision on the VAT chargeable on the Supply.
and suggests that is flatly inconsistent with the evidence given by Jim Harra to the PAC (linked previously)
Maugham concludes
"The Statement of Case pretends the situation is otherwise. It pretends that HMRC have not decided whether Uber is chargeable to input tax. And it embarks on that pretence because it wants to escape independent judicial scrutiny of its decision. There is, on the evidence, simply no other explanation.
There is no good explanation for why HMRC might adopt a position that leads to a loss of tax of, by our calculations, around £200 million per year. And in the absence of a good explanation you are compelled to a bad one. Last week direct evidence emerged that HM Treasury does put HMRC under pressure to go easy on other large US multinationals. We cannot identify any alternative candidate explanation that is consistent with the facts.
We will reply – likely next week – to HMRC and the specialist tax Tribunal making these points. And we will invite the Tribunal to refuse to allow itself to be used to advance what, on the evidence, looks to be a simple ruse."
Edited by anonymous-user on Wednesday 31st January 11:02
Maugham has another update on the case
https://goodlawproject.org/uber-update-march-2018/
Since the last update he states that The Good Law Project has
(1) We have replied to HMRC’s Statement of Case: Uber-Reply in which we point out the contradictions in HMRC’s position set out in our update (a link to which is set out above).
(2) The First-tier Tribunal has issued standard directions for the conduct of the hearing: UberDirections.
(3) We have written to the Tribunal stating that those standard directions are inappropriate, explaining why, and asking for the matter to be placed before the President of the Tribunal: Ltr-to-HMCTS-19-Feb-2018.
(4) We have repeatedly chased the Tribunal to list the matter for an urgent hearing (and we understand that the matter was placed before the Judge last week). When we have a date we will announce it.
We are pushing the matter as hard and as fast as we can. But these are not matters over which we can exercise control. We have no reason to think that we will be unable to deliver the purpose of the litigation stated above. And we have no present reason to think that the monies we have raised will be insufficient to pursue that purpose – of course this may change if, for example, Uber or HMRC were to appeal. None of the monies raised have or will go to Jolyon Maugham QC; none have been absorbed into the general spending of the Good Law Project. Neither makes any charge in connection with this litigation.
https://goodlawproject.org/uber-update-march-2018/
Since the last update he states that The Good Law Project has
(1) We have replied to HMRC’s Statement of Case: Uber-Reply in which we point out the contradictions in HMRC’s position set out in our update (a link to which is set out above).
(2) The First-tier Tribunal has issued standard directions for the conduct of the hearing: UberDirections.
(3) We have written to the Tribunal stating that those standard directions are inappropriate, explaining why, and asking for the matter to be placed before the President of the Tribunal: Ltr-to-HMCTS-19-Feb-2018.
(4) We have repeatedly chased the Tribunal to list the matter for an urgent hearing (and we understand that the matter was placed before the Judge last week). When we have a date we will announce it.
We are pushing the matter as hard and as fast as we can. But these are not matters over which we can exercise control. We have no reason to think that we will be unable to deliver the purpose of the litigation stated above. And we have no present reason to think that the monies we have raised will be insufficient to pursue that purpose – of course this may change if, for example, Uber or HMRC were to appeal. None of the monies raised have or will go to Jolyon Maugham QC; none have been absorbed into the general spending of the Good Law Project. Neither makes any charge in connection with this litigation.
Elsewhere in Europe, Portugal to be specific, there is a special new "tax" for Uber and similar operators
A limit on the intermediation fee (to 25%) which is subject to a 5% tax
H/T @JudithFreedman on the twitter
https://twitter.com/JudithFreedman/status/98626806...
A limit on the intermediation fee (to 25%) which is subject to a 5% tax
H/T @JudithFreedman on the twitter
https://twitter.com/JudithFreedman/status/98626806...
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