What is it with Philip Aldrick?

His comments follow the revelation that Barclays has stockpiled billions of pounds of \”losses\” to reduce future tax bills, despite not having made a loss at group level for over a decade. They also come shortly after the pledge by Bob Diamond, Barclays\’ chief executive, for \”banks to be better citizens\”.

He then goes on to repeat the nonsense he spouted yesterday.

I mean seriously, what the hell is this with \” \” around losses?

As an example: I\’ve no idea about the Telegraph\’s finances but I\’m sure that there are some parts of the group that make losses, other parts that make profits. You get to offset one against the other. That\’s certainly true at the Guardian Media Group, is it not?

However, when you start going over tax jurisdiction boundaries then it\’s not quite so simple. You don\’t get to say well, we made a loss in Spain therefore the tax on our UK business is reduced. The loss in Spain gets \”warehoused\” until you\’re making a profit in Spain against which you can offset those previous losses.

So it\’s entirely obvious that you can have losses in an international group, even while having overall profits…..and thus tax credits in places even while having overall profits.

So what is Aldrick doing? Is this simply that he\’s got the wrong end of the stick? Or is he being told to write this nonsense?

4 comments on “What is it with Philip Aldrick?

  1. For a banking business, it’s also possibly timing differences – unrealised losses having to be taken as a hit in the accounts, but not allowed for tax until they’re realised.

    But (as I’ve commented on the Telegraph site) it’s a stupid article. Why would Barclays want to “stockpile” losses? They’d much rather be able to use them and get the benefit now.

  2. Fundamentally though, this is just rubbish. If there was a loss in a previous year which was “stockpiled”, by definition, it was not used to offset profit in that year and tax revenues were therefore higher then than they would have been otherwise.

    To avoid making that – obvious – point renders the article largely mendacious. (unless of course the author simply does not understand anything at all about anything at all in which case he shouldn’t be let out without adult supervision…)

  3. what does “stockpile” mean in this context anyway? When I did my articles, you used the losses against prior year profits, or this year’s profits, or else had to carry them forward. The option of “stockpiling” was not included in the voluminous legislation.

  4. Is he an economist? Indeed is he a journalist?

    I suspect he is being told to write his rubbish. The main purpose I think of articles in places like the Telegraph on line is to keep the loony tune hysterical fringe entertained and keep the hit rate up.

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