48 comments on “Timmy dissing UKuncut

  1. I posted this under the article there. They haven’t published it yet, but hopefully they will.

    This article demonstrates a lack of knowledge of how international tax works. “We cannot tax on both, domicile and activity.” Simply wrong. There is not just one, but various different forms of income that flows from cross-border investment, and countries sign treaties with each other agreeing which country gets to tax which bit of the income. Businesses can be taxed in the host country receiving the investment, and in the home country where the investor is based – and there is no double taxation. The treaty sees to that.

    As for the Philip Green arguments, well you have used the classic, well, what is sometimes known as the “Philip Green Defence.” The argument runs like this: “no tax was due, so no tax was avoided.” Which of course papers over the fact that no tax was due because of all the clever shenanigans that went into avoiding that tax in the first place. This argument looks right, when you read it, and it will certainly fool a lot of people – but it’s simply a rather transparent attempt at bamboozlement.

    And then the ‘equality’ thing. Are you saying that all members of UK Uncut are feminists, and therefore that allowing Philip Green’s wife to be part of a massive tax avoidance scam should not be criticised because she was a woman? Oh please. It reminds me of when one of the Dutch royals got caught doing something similar, and her spokesman defended her saying effectively that she should be allowed to get away with it because she had an eye condition.

    If you’re going to sneer at young people, at least make sure you know what you’re talking about first.

  2. Nick Shaxson – “This argument looks right, when you read it, and it will certainly fool a lot of people – but it’s simply a rather transparent attempt at bamboozlement.”

    I would be more willing to agree with this if I could work out what your position is. I take it what you mean is that you think that Mr. Green ought to have paid more tax, and so the tax code should have agreed with you and so he is guilty of avoiding paying those taxes you think he should have paid, even though he was fully compliant with the law?

    That is your position, right?

  3. Nick Shaxson – ” The treaty sees to that.”

    So you’re saying Mr. Green is fully compliant with these treaties and the British government is bound by these treaties not to double tax him, but they should have any way because you feel that he ought to have paid more tax?

    Again I feel I am not quite getting it.

  4. Nick Shaxson

    A lot of people seem to have formed an opinion that Philip Green has abused the undisputed fact that his wife is not resident or domiciled in the UK, by making her the shareholder of Arcadia. Even those critics appear to accept that this is totally lawful.
    What nobody has commented on is the risks that Philip Green has taken by structuring his affairs in this way. If he and his wife were to ever divorce, then he’d have absolutely no chance of trying to argue that his wife was only acting as nominee for him. The shares are hers, not his, and that does not appear to be a sham at all. There appears to have been a proper “transfer of risk” here, and critics need to get their head around that point.

    If this was some shady little nominee agreement where she was merely pretending to be the beneficial owner of the shares then of course the structure should be attacked. But it isn’t. If the law should be changed, then so be it. But until and unless the law is changed, there is nothing at all wrong with the structure.

  5. So Much . . . I don’t think you should mix up my separate points about treaties with the point about Green. That’s a recipe for confusion.

    As regards tax avoidance and whether what is legal is automatically legitimate, well I will wheel out this thing that I’m rather tired of wheeling out: slavery and apartheid were legal in their day: that didn’t make it legitimate. Tax avoidance by definition is legal, but also by definition involves getting around the spirit of the law. Which in my book makes it wrong.

    Gerald – your point about the risk is well taken, though there are an awful lot of ifs and buts involved. Who knows whether, in a divorce, he’d really lose the lot? From where I’m sitting, this looks like a tax dodge. And there is plenty wrong with this structure.

  6. Nick Shaxson

    “slavery and apartheid were legal in their day: that didn’t make it legitimate”.

    This is totally disingenuous. The victims of slavery and apartheid did not have the opportunity to vote to repeal their status, or the right fight against their condition through an impartial justice system. It is difficult to see apartheid and slavery as legitimate.

    the UK is a universal and representative democracy, where an elected parliament passes tax laws. Our courts are impartial, and have consistently upheld the citizen’s right to arrange their tax affairs in accordance with the letter of the law only.

    Try harder. This is a failed argument.

  7. “Tax avoidance by definition is legal, but also by definition involves getting around the spirit of the law. Which in my book makes it wrong.”

    Oh gawd, This statement is nonsensical.

    The ‘law’ is there in black and white on the statue book. Arbitrary interpretation, courtesy of some wholly sectarian ‘spirit’ is neither just or moral.

    You haven’t addressed a single point raised in the paper.

    Comparing the legality of tax avoidance to slavery and apartheid is utterly fallacious.

  8. As regards tax avoidance and whether what is legal is automatically legitimate, well I will wheel out this thing that I’m rather tired of wheeling out: slavery and apartheid were legal in their day: that didn’t make it legitimate.

    Quite. And the answer to both was to change the law and not start hanging people willy-nilly.

  9. I know, I know, you’ll never accept these arguments, because you’ve got your opinion, and I have mine. But you have to admit, don’t you, that I’m at least just a teensy-weensy bit right . . .

  10. Nick Shaxson – “I don’t think you should mix up my separate points about treaties with the point about Green. That’s a recipe for confusion.”

    So you mean in theory, if we were not bound by treaty already, we could double tax someone a lot like Mr. Green without specifically meaning Green himself?

    “Tax avoidance by definition is legal, but also by definition involves getting around the spirit of the law. Which in my book makes it wrong.”

    Yes but wrong-in-the-legal-sense wrong or wrong-in-the-meaningless-moral-sense wrong? You want to change the law until it reflects what you consider is morally right, or do you just want to jail someone based on what you feel the law should have said, even though it didn’t?

    In fact this leads to all sort of problems. Who is to decide what Parliament really meant if Parliament did not specifically write into law what you think they should have? The Courts? They are to be given carte blanche to decide for themselves what the spirit of the law should be even though the letter of the law is not? You actually want the Courts to adopt lynch justice?

  11. Nick Shaxson – “But you have to admit, don’t you, that I’m at least just a teensy-weensy bit right . . .”

    Well not on the letter of your arguments. But perhaps there is some spirit to them I don’t get.

  12. Nick Shaxson

    “But you have to admit, don’t you, that I’m at least just a teensy-weensy bit right . . .”

    on which bit?

  13. ““ you have used the classic, well, what is sometimes known as the “Philip Green Defence.” The argument runs like this: “no tax was due, so no tax was avoided.”

    It is more than a little Kafkaesque to argue against the truth of that. Presumably you would have corporations pay tax that was not due?

    Philip Green does not own Arcadia. It’s owners – since purchase – are not UK resident. That is the end of it.

    “Tax avoidance by definition is legal, but also by definition involves getting around the spirit of the law. ”

    The “spirit of the law” as regards tax is absolutely clear . Within the law (including such anti-avoidnce provision as exist from time to time), a person is entitled to arrange his affairs so as to minimise his tax liability (Ayrshire Pullman Motor Services v. the Commissioner of Inland Revenue). The courts have repeatedly made this clear.

    It is no more than a form of either arrogance or wilful ignorance to persist in claiming to have identified any other “spirit”.

    If you do not like this, concentrate on the essentially political process of trying to change hundreds of years of tax law to establish a different “spirit”.

  14. I can’t get past the idea that Our Avuncular Host (OAH) and Ritchie & Co. are arguing past each other. OAH is, quite properly to my mind, arguing from what is. R&Co. are arguing from what they, according to their moral lights, believe should be. From the beginning it’s a non-meeting of minds and is therefore unresolvable.

    Still, it’s not half entertaining.

  15. “From the beginning it’s a non-meeting of minds and is therefore unresolvable.”

    Yes, but R&Co. think that their moral viewpoint gives them the right to smash windows, drop fire extinguishers, cause disruption and criminal damage. And then they express outrage at the idea that they should be treated as criminals.

    If one were to take the R&Co arguments as valid I could quite easily claim the right to burn his Norfolk home down based on the evil that his supposed good intentions are doing.

  16. How can morality be incorporated into tax law? Or any law for that matter? I think its perfectly OK Philip Green to act as he has, R&Co think differently. Why should their morality trump mine?

    We have spent 50 years making morality more and more a private issue, by legalising actions previously regarded as immoral. Abortion, homosexuality, civil partnerships etc etc. Thus we have decided that your desire to be gay is yours, not the State’s to decide upon.

    So are R&Co suggesting that taxation should be the same? That they can pay as much tax as their morality demands, whereas I can pay as little as mine requires? I could quite go for that!!

    If R&Co wish to reform the tax laws they should publish a tax code (it might take a while, even for as prolific an author as Ritchie) and let everyone have a good look at it and decide if they are in favour or not. A bit of democracy wouldn’t go amiss here at all, rather than constantly shouting ‘Its immoral! Its wrong!! Nasty people should pay more tax!!’

  17. Shaxson

    While you are talking to your pal Murphy, tell him to open up his comments again(he can delete any comments with 4 letter words in them) and lets see how well you do in a real debate. You can appear on Tim’s website slinging your crap but anyone who does not agree with Murphy is down the pan on his. Socialism in action.

  18. @Nick Shaxson

    ““We cannot tax on both, domicile and activity.” Simply wrong.”

    In fact the full quote was :

    “we cannot tax on both, domicile and activity. Not, at least, if we’re to avoid simply taxing any and everyone just because we can which isn’t quite the logical base for a socio-economic system that we might want.”

    Tim did suggest exercising some comprehension skills.

    “what is legal is automatically legitimate”

    I’ve quoted that out of context, but it is in fact correct. Consult a quality dictionary – or even a shit one – and you will find that that is in fact the precise meaning of the word ‘legitimate’.

    As for all this “spirit of the law” cockwaffle, I’m afraid that it demonstrates a complete misunderstanding of the way that the law works.

    In some cases, when the law itself is unclear as written, a properly appointed judge – or more likely a panel of senior judges – may consult Hansard and other sources and deliberate as to what exactly the ‘spirit’ of a particular law was intended to be.

    In the case of – for example – Vodafone, I am not at all aware that this recourse was taken during its progress through the court system.

    Your argument about the spirit of the law requires you to do exactly that, have you done so ? If so, what were the results of the investigation ? What laws have been examined ? What activities of which companies have been found to be in violation of what you have found to be the spirit of which laws ? Where is all this documented ?

    Or are you just happy to imagine that ‘the spirit of the law’ is something closely akin to your own personal point of view about such things, because it’s just obvious to you that that is how ‘the law’ is formulated ?

    “But you have to admit, don’t you, that I’m at least just a teensy-weensy bit right . . .”

    I will happily admit that your argument has some merit if you are happy to admit that it boils down to : “some people have more stuff than me, I want some of their of their stuff”, in which case it would derive some merit from being founded upon a ‘legitimate’ socio-economic ideology – at least until we manage to outlaw crass stupidity.

    Otherwise, no, fuck off, you are not just wrong but disastrously misinformed, lacking in logic and unable to grasp that fact.

    You seem to have some difficulty with dense text, so to summarise the above : anyone with half a brain would find some merit in your arguments, those who have access to a whole one think you’re a dick.

  19. @Nick Shaxson

    Perhaps the law is a’ ass, a’ idiot, but it is the only law we have.

    Just remember, if you get to interpret the law as you see fit one day it might be the BNP interpreting as they see fit. I think we can both agree that is not something we desire to see?

    So, lets stick with Parliament writing the law and the Judiciary deciding what is meant rather than a group of noisy individuals, no matter how well intentioned.

  20. Tim
    Are you banned again from commenting on the article of Murphy’s website even though it is written about you?

    tim adds: Heh….hadn’t even occured to me to bother to try and comment there.

  21. Nick,

    Could you please explain the logical basis on which Sir Philip Green should be taxed? Bearing in mind that justice demands that the same be applied to all taxpayers.

    I can only think of 2 possible ones, neither of which look like a good idea:

    a) that all husbands should be taxed on their wives income (we used to do this, but in 1988 Parliament voted that this was no longer suitable); or

    b) that all foreign residents should pay tax on dividends from UK companies (which would be an unusual approach to international taxation, and might cause a bit of a drop in inbound investment).

    Which is it? Or if it’s some other reason, please explain it.

  22. Tax avoidance by definition is legal, but also by definition involves getting around the spirit of the law.

    Well this seems simple. Go around and ask everyone you think is committing tax avoidance (as opposed to tax evasion, which breaks the letter of the law), “are you obeying the spirit of the law”.
    If they say yes, then they’re not, in their eyes, getting around the spirit of the law, so presumably from then on you’ll stop accusing them of committing tax avoidance. (You would of course remain free to point out cases of tax evasion, subject to legal limits on libel and what not).
    I suspect everyone you ask would answer yes, that they were obeying the spirit of the law, and if I’m right then you’ll have no further reason to worry about tax avoidance.

  23. Ok, to summarise my critics. I think I’m being fair here:
    a) you’re wrong shaxson so there
    b) it’s the law, end of.
    c) this is all about Richard Murphy, really.
    d) fuck off, cockwaffle, etc etc.
    My answers:
    a) yes, OK, you’re entitled to your opinion.
    b) this is the only one worth responding properly to, in my view. So if a corporation contorts itself into fantastical shapes, setting up one-man booking offices all over the place, eliminates its tax bill that way, and gets everyone else to pay their taxes for them – that is fine, is it? I know what y’all will say – yes it’s fine! Of course you will. But let’s say now we did a survey of the nation, shall we? And asked them that same question. I think you’ll accept that the large majority of people, even on a diluted version of this question, and even before the big cuts really start to bite, would be on my side. There’s just no way around this – this stuff is wrong, and it needs to be challenged. There are of course degrees of wrongness, but that doesn’t change the basic argument. Richard Teather’s argument (hello Richard!) fits into this too, I think. This seems to me to be a straightforward tax dodge, to get around the law without actually breaking it.
    c) No it simply isn’t. This is a straw man argument.
    d) Yes, useful contributions to the debate, hmm.
    OK, that’s the end of my responses on this. A fair bit more yappin’ to come, I expect – but not from me.

  24. Of course in the Arctic Systems case, the Supreme Court (or was it the old HoL?) said that the sort of thing Sir Philip & Tina Green have done is not just within the letter of the law – it is within the spirit as well.

    The bits of law that say that husband & wife are to be taxed separately, and that husband & wife can transfer assets between themselves free of tax, are so clear and fundamental that if there is any spirit of tax law, they must form part of it.

  25. Good to see you in here, Nick – but an answer to my question would be nice.

    I wasn’t just saying that the current law says it’s not taxable – I’m saying that I can’t think of a sensible law that would make it taxable.

  26. @Shaxson

    “I think you’ll accept that the large majority of people, even on a diluted version of this question, and even before the big cuts really start to bite, would be on my side.”

    No, I don’t accept that, it is simply an example of projection. You believe this to be the case because you believe that your position is correct and therefore all reasonable folks must agree with you.

    In reality there is no reason to suppose that this is the case until you have actually asked them.

    Worse than that, the logical extension of this argument is that we can do away with all this costly and time consuming democracy stuff because Shaxson is basically correct and we can pretty much guess that everyone will agree with him. Fuck, let’s just make him emperor of the universe and save ourselves the tedium of forming our own opinions based on such outdated concepts as facts.

    Do you see what you’ve done there ?

  27. Shaxson – “But let’s say now we did a survey of the nation, shall we? And asked them that same question. I think you’ll accept that the large majority of people, even on a diluted version of this question, ……, would be on my side.”

    While conducting this survey, we could also ask the nation if it supports reintroducing the death penalty, or it favors mass deportations of immigrants. Chance is they would would be for it. (there are a few other questions I can think of).

    Does it mean these policies are correct?

    I don’t expect that you will reply to this, but I am sure you will read it and maybe pause to reflect on the weakness of your argument here.

  28. “While conducting this survey, we could also ask the nation if it supports reintroducing the death penalty, or it favors mass deportations of immigrants. Chance is they would would be for it. (there are a few other questions I can think of).

    Does it mean these policies are correct?”

    Yes, these 2 specific policies are “correct” and would be democratically approved (which is why the questions will never be put to us) and would have the added benefit that, if introduced, would require us to leave the EU. So, when do we get them?

  29. “But let’s say now we did a survey of the nation, shall we? And asked them that same question. I think you’ll accept that the large majority of people, even on a diluted version of this question, and even before the big cuts really start to bite, would be on my side.”

    The majority of the country are unthinking, greedy morons, easily swayed by the politics of envy and happy to never think how such a law could one day be used against them.

    And you think that’s a good thing?

  30. Oh, and by the way, Nickie boy, when you’re asking that ”large majority of people’, you might also ask them if they’ve ever cheated on their expenses, massaged an insurance claim, paid (or accepted) cash in hand, or bought stuff in a pub from a mate.

  31. “I know what y’all will say – yes it’s fine! ”

    No we don’t need to say that. Even if we were to believe that it is wrong you can still not punish people for things that were legal at that time. You can certainly campaing for changing the law and after the law is changed those that do not obey the law from that point onwards should of course be punished.

  32. “Gerald // Mar 18, 2011 at 4:05 pm

    Tim
    Are you banned again from commenting on the article of Murphy’s website even though it is written about you?

    tim adds: Heh….hadn’t even occured to me to bother to try and comment there.”

    All comments are switched off in Murphyland.

  33. @Richard Teather

    “b) that all foreign residents should pay tax on dividends from UK companies (which would be an unusual approach to international taxation, and might cause a bit of a drop in inbound investment).”

    What’s actually wrong with this policy? At the very least, tax dividends being paid to countries we do not have tax treaties with.

    Why should we give preferential treatment to shareholders who do not live here? If they make their money in the UK, they should pay their taxes here… especially with corporation tax being so ineffectual (though not, I must add, in the case of Arcadia).

  34. @Emil

    I sympathise with the view that UKuncut should be protesting outside the treasury.. especially as many of them don’t even realise that, in many respects, they really are in the wrong place.

    However, civil action against companies indulging in practices we don’t approve of is valid. The boycotts of Nike and Nestle because of their dodgy practices were reasonably successful in raising awareness of issues and bringing about both legislative changes and changes in their practices. They weren’t breaking laws either, but it didn’t mean that what they were doing was OK.

  35. Alex

    I predicted that this morning when I saw Murphy’s attack on Tim’s article. I just knew that he would get so many posters today of the type that he hates that he would collapse under the strain and take his ball away. He really doesn’t like playing with the “big boys” (for which, read those who disagree with him). He’s only prepared to engage with those who he knows he can beat in an argument.

    What a twat.

  36. As regards UK Uncut, I find it hard to take seriously a group whose name sounds like an anti-circumcision pressure group.

  37. But let’s say now we did a survey of the nation, shall we? And asked them that same question. I think you’ll accept that the large majority of people, even on a diluted version of this question, and even before the big cuts really start to bite, would be on my side.

    Ah yes, an appeal to the “court of public opinion” aka mob rule.

  38. Nick

    I think you might want to re-read your “slavery and apartheid” comments and then reconsider your “appeal to national sentiment” justification. The contradiction should be clear.

  39. Nick S

    “So if a corporation contorts itself into fantastical shapes, setting up one-man booking offices all over the place, eliminates its tax bill that way, and gets everyone else to pay their taxes for them – that is fine, is it? ”

    I think you’ll find that HMRC have a habit of seeing this as more akin to evasion than avoidance. The one-man booking office does not constitute the economic substance of a transaction so that will be unlikely to fly.

    However, please explain to us exactly how this applies to the Vodafone case? Really genuinely seriously: are you really suggesting that german phones sold on german contracts from german shops in germany AND UPON WHICH TAX HAS BEEN PAID IN GERMANY are really actually a cunning wheeze to diddle HMRC out of tax which is so substantively due in the UK that they should be chased through the court for it?

    Really seriously?

    The key here is from your first response:

    “This article demonstrates a lack of knowledge of how international tax works. “We cannot tax on both, domicile and activity.” Simply wrong. There is not just one, but various different forms of income that flows from cross-border investment, and countries sign treaties with each other agreeing which country gets to tax which bit of the income. “

    This is irrelevant: Tim, everyone else here and crucially HMRC also is talking about double taxation ON THE SAME INCOME STREAM.

    Tim and everyone else here thinks that it should only be taxed once – either on domicile or activity. HMRC wanted both and were referred to the reply in Arkel vs Pressdram (1971).

    You? Well I can’t tell. Perhaps you could clear this up.

  40. And while we are at it, this is cockwaffle:
    “gets everyone else to pay their taxes for them ”

    Bollocks. There is not a set amount of tax which has to be paid by someone, so that person A reducing his tax bill necessarily imposes additional costs on everyone else. This is a classic statist/collectivist fallacy.

  41. I didn’t believe that I would ever come across someone who is more of a weapons’ grade cock end than the Murph-meister…Shaxtwat certainly outdoes him in sheer inability to argue a point or even argue coherently.

  42. are we permitted to ask why the Shaxtwat lives in Zurich? Doies that mean he is avoiding tax he should properly be paying tin the UK?

  43. @Kay Tie // Mar 18, 2011 at 1:59 pm

    …R&Co. think that their moral viewpoint gives them the right to smash windows, drop fire extinguishers, cause disruption and criminal damage. And then they express outrage at the idea that they should be treated as criminals.

    When have UK Uncut smashed windows and dropped fire extinguishers (next to policemen, presumably)? Are you deliberately smearing one issue group with the actions of another in order to belittle them?

    Putting that aside, it’s interesting to note that there’s so many tacit supporters of the Adam Smith Institute who conveniently ignore his four principles of taxation. It’s not dissimilar to Christians who use the Old Testament as justification for aggressive homophobia yet wear mixed fabrics and eat shellfish…

  44. “Are you deliberately smearing one issue group with the actions of another in order to belittle them”

    I’m sorry, that was the Judean People’s Front. So hard to tell them apart: they all look, talk, think and behave alike. All young, gullible, ignorant and easily manipulated by the Usual Suspects.

  45. diogenes –

    are we permitted to ask why the Shaxtwat lives in Zurich? Doies that mean he is avoiding tax he should properly be paying tin the UK?

    some smartass has been challenging Shaxson about this over on his rag (here: http://treasureislands.org/ten-reasons-why-we-should-tax-corporations/ , and here: http://treasureislands.org/more-on-corporation-taxes/).

    To summarise, he does not pay any UK tax, but pays full tax in Switzerland, and has no problem with the fact that he is saving himself 30% in the process. His defence: “you don’t understand how international tax work” and “I am playing by the rules”…. When challenged if that complies with “right place, right time, blah blah” thing, he says this is Ritchie’s view things, and not that of the TJN, so not his.

Leave a Reply

Name and email are required. Your email address will not be published.

This site uses Akismet to reduce spam. Learn how your comment data is processed.