BBC2 "The Town that Took on the Taxman"
Discussion
Anyone else watching this, or maybe on iPlayer ?
This is quite a fascinating insight into locating your 'small business' off-shore to minimise corporation tax, it's a bit of a tongue in cheek look at it......but food for thought for those of us who are about to be caned with the new tax on directors dividends in April.
Worth a watch, interested in people's thoughts.
This is quite a fascinating insight into locating your 'small business' off-shore to minimise corporation tax, it's a bit of a tongue in cheek look at it......but food for thought for those of us who are about to be caned with the new tax on directors dividends in April.
Worth a watch, interested in people's thoughts.
An interesting program.
It seems so simple for a multinational to set-up the Dutch sandwich, that it has to be simple for a Government to bring in a 5% turnover tax for any company that lodges its IP offshore.
The issue is something that urgently needs fixing if we are to believe that "We are all in it together". It is not as though UK Corporation tax is unreasonably high.
It seems so simple for a multinational to set-up the Dutch sandwich, that it has to be simple for a Government to bring in a 5% turnover tax for any company that lodges its IP offshore.
The issue is something that urgently needs fixing if we are to believe that "We are all in it together". It is not as though UK Corporation tax is unreasonably high.
rdjohn said:
...It is not as though UK Corporation tax is unreasonably high.
Unless you compare it to the IoM or the Caymans 
I just wish a government would be brave enough to do away with 11,000 pages of tax legislation & impose a reasonable flat rate on individuals & businesses. Other jurisdictions have made this approach work so well that the tax take actually increased.
nxi20 said:
Unless you compare it to the IoM or the Caymans
I just wish a government would be brave enough to do away with 11,000 pages of tax legislation & impose a reasonable flat rate on individuals & businesses. Other jurisdictions have made this approach work so well that the tax take actually increased.
In the UK for individuals it can't possibly work as so much tax is paid by a few people. They came close to doing it in Australia a few years ago and only realised fairly late in the day that for it to be revenue neutral the vast majority of people would be worse off, and wealthy people would gain massively.I just wish a government would be brave enough to do away with 11,000 pages of tax legislation & impose a reasonable flat rate on individuals & businesses. Other jurisdictions have made this approach work so well that the tax take actually increased.
Estonia has 20% flat tax - but their equivalent of employers NI is 35%.
Eric Mc said:
What jurisdictions have scrapped their historic complex tax codes and replaced them with a simple one?
Georgia, not the one in the USA.Something like 38 down to 6, taxes that is.
Economy went through the ceiling in growth.
This happened a few years back now.
The finance minister that introduced these changes has since died.
Cannot remember his name.
So, it can be done.
It'll never happen in the UK. What would you do with all those jobs?
Phil
Transmitter Man said:
Georgia, not the one in the USA.
Something like 38 down to 6, taxes that is.
Economy went through the ceiling in growth.
This happened a few years back now.
The finance minister that introduced these changes has since died.
Cannot remember his name.
So, it can be done.
It'll never happen in the UK. What would you do with all those jobs?
Phil
I don't think Georgia can be used as an example of a long established developed, industrial, Western Style economy that has had a long history of taxation in the "modern" era that suddenly decided to simplify matters. I think that you will find that most countries that have adopted a "Flat Rate" approach to tax are relatively newly established countries who have become autonomous in the past 20 to 30 years. In many ways, it's "easy" for them because they are not undoing centuries of evolving tax complexity. Essentially, they are "rebooting" as independent countries with a blank slate.Something like 38 down to 6, taxes that is.
Economy went through the ceiling in growth.
This happened a few years back now.
The finance minister that introduced these changes has since died.
Cannot remember his name.
So, it can be done.
It'll never happen in the UK. What would you do with all those jobs?
Phil
If you look at the Western European countries, the USA, Australia etc you will see almost 200 years of continual laying down of layer upon layer of tax rules. NONE of those more sophisticated economies have really tried to massively simplify their tax regimes. Indeed, it is probably impossible for them to do so - but they could make a start by not adding further complexities. Unfortunately, they insist on doing just that.
Sam All said:
I was hoping you would mention the main "simplifications". I haven't got time at the moment to read the history as I am in the middle of coping with our "complex" tax system.Just watched this and as I am not financial expert, a few questions:
Does Holland not have any Corp Tax? I assume so otherwise what is so special about sending money there?
The govt created a 25% rate for IP but couldn't companies just make up some other reason?
I have to agree with some of the big boys who avoid CT who say that their employees pay lots of tax, they pay tax on goods, overheads etc and they even get taxed for employing people who then pay tax! After that I can understand them saying 'We've paid enough tax now sod off.' Smaller businesses should do the same but the system will only change when lots of small businesses start doing this...
Does Holland not have any Corp Tax? I assume so otherwise what is so special about sending money there?
The govt created a 25% rate for IP but couldn't companies just make up some other reason?
I have to agree with some of the big boys who avoid CT who say that their employees pay lots of tax, they pay tax on goods, overheads etc and they even get taxed for employing people who then pay tax! After that I can understand them saying 'We've paid enough tax now sod off.' Smaller businesses should do the same but the system will only change when lots of small businesses start doing this...
Frimley111R said:
Just watched this and as I am not financial expert, a few questions:
Does Holland not have any Corp Tax? I assume so otherwise what is so special about sending money there?
The govt created a 25% rate for IP but couldn't companies just make up some other reason?
I have to agree with some of the big boys who avoid CT who say that their employees pay lots of tax, they pay tax on goods, overheads etc and they even get taxed for employing people who then pay tax! After that I can understand them saying 'We've paid enough tax now sod off.' Smaller businesses should do the same but the system will only change when lots of small businesses start doing this...
The tax employer's pay is respect of their employee's is not, strictly speaking, a burden for the employer. They are acting as tax handling agents on behalf of the employee - and merely handing over the EMPLOYEE'S tax liability to HMRC. Of course, the employer's NI is a genuine business cost.Does Holland not have any Corp Tax? I assume so otherwise what is so special about sending money there?
The govt created a 25% rate for IP but couldn't companies just make up some other reason?
I have to agree with some of the big boys who avoid CT who say that their employees pay lots of tax, they pay tax on goods, overheads etc and they even get taxed for employing people who then pay tax! After that I can understand them saying 'We've paid enough tax now sod off.' Smaller businesses should do the same but the system will only change when lots of small businesses start doing this...
VAT, as well, is not strictly speaking paid by the business. It is COLLRCTED by the business from the actual payer - which is you and me. Again, they are acting as collecting agent on behalf of the government.
The real cost of these taxes is not the taxes itself but the burden of administering them.
SMALL businesses have to cope with all this too. And, on a proportional basis, the cost of administering these taxes on behalf of government is a much larger burden for smaller businesses than it is for the larger ones.
Eric Mc said:
The tax employer's pay is respect of their employee's is not, strictly speaking, a burden for the employer. They are acting as tax handling agents on behalf of the employee - and merely handing over the EMPLOYEE'S tax liability to HMRC. Of course, the employer's NI is a genuine business cost.
VAT, as well, is not strictly speaking paid by the business. It is COLLRCTED by the business from the actual payer - which is you and me. Again, they are acting as collecting agent on behalf of the government.
The real cost of these taxes is not the taxes itself but the burden of administering them.
SMALL businesses have to cope with all this too. And, on a proportional basis, the cost of administering these taxes on behalf of government is a much larger burden for smaller businesses than it is for the larger ones.
Well putVAT, as well, is not strictly speaking paid by the business. It is COLLRCTED by the business from the actual payer - which is you and me. Again, they are acting as collecting agent on behalf of the government.
The real cost of these taxes is not the taxes itself but the burden of administering them.
SMALL businesses have to cope with all this too. And, on a proportional basis, the cost of administering these taxes on behalf of government is a much larger burden for smaller businesses than it is for the larger ones.
I never understand when business moan about how much VAT there paying. It wasn't there's in the first place. The more you pay the more your turn over is which should equate to more profit.
Eric Mc said:
Frimley111R said:
Just watched this and as I am not financial expert, a few questions:
Does Holland not have any Corp Tax? I assume so otherwise what is so special about sending money there?
The govt created a 25% rate for IP but couldn't companies just make up some other reason?
I have to agree with some of the big boys who avoid CT who say that their employees pay lots of tax, they pay tax on goods, overheads etc and they even get taxed for employing people who then pay tax! After that I can understand them saying 'We've paid enough tax now sod off.' Smaller businesses should do the same but the system will only change when lots of small businesses start doing this...
The tax employer's pay is respect of their employee's is not, strictly speaking, a burden for the employer. They are acting as tax handling agents on behalf of the employee - and merely handing over the EMPLOYEE'S tax liability to HMRC. Of course, the employer's NI is a genuine business cost.Does Holland not have any Corp Tax? I assume so otherwise what is so special about sending money there?
The govt created a 25% rate for IP but couldn't companies just make up some other reason?
I have to agree with some of the big boys who avoid CT who say that their employees pay lots of tax, they pay tax on goods, overheads etc and they even get taxed for employing people who then pay tax! After that I can understand them saying 'We've paid enough tax now sod off.' Smaller businesses should do the same but the system will only change when lots of small businesses start doing this...
VAT, as well, is not strictly speaking paid by the business. It is COLLRCTED by the business from the actual payer - which is you and me. Again, they are acting as collecting agent on behalf of the government.
The real cost of these taxes is not the taxes itself but the burden of administering them.
SMALL businesses have to cope with all this too. And, on a proportional basis, the cost of administering these taxes on behalf of government is a much larger burden for smaller businesses than it is for the larger ones.
We are unpaid collection agents in practice and have no benefits from doing this for the government.
Yes - as I said above, that is the real cost - and it is a bigger costs proportionally for smaller businesses..
What the programme was about was the ability of large corporations to create an unfair advantage over their smaller competitors due to their ability to manipulate where they decide to pay their taxes.
What the programme was about was the ability of large corporations to create an unfair advantage over their smaller competitors due to their ability to manipulate where they decide to pay their taxes.
Eric Mc said:
Of course, the employer's NI is a genuine business cost.
A distinction without a difference though. If the cost of employing you is £1000 a week you have to provide > £1000 a week value to your employer. How that £1000 is distributed between take home pay, income tax, employees NI employers NI etc is ultimately irrelevant.Gassing Station | Business | Top of Page | What's New | My Stuff