Ritchie on the Girt Big Tax Refund

Dear Lord, is there nothing that he won\’t stoop to?

Now I know this has been coming for a long time. I also happen to think the logic of this decision is absurd: the suggestion that within the EU there was no room for individual country tax policy is one now so long discredited when it is so obvious that tax is used as a form of abuse by so many EU member states (like the Netherlands as revealed in the case of Starbucks, yesterday) that this ruling is absurd in its logic.

But absurd as it is we’ll be giving £5 billion to enrich big business. That’s enough to pay for the UK’s universities, for a year. Or enough to fund a quarter of the whole UK housing and environment budget. Or over one fifth of the transport budget.And it could stop NHS cuts for a year. But we’ll give it to big business instead. And you will lose as a result. Work out the justice in that.

Now that we\’ve got the ruling on what both the letter and the spirit of the law are he still wants the tax to be paid even though both the letter and spirit of the law state that it shouldn\’t be payable?

Seriously? The law can just go hang because Ritchie says so?

Fuck me, he\’s proposing a dictatorship.

12 comments on “Ritchie on the Girt Big Tax Refund

  1. Like the rest of them, he’s desperate. Even a crappy accountant can do the maths, and it all points to not enough money can ever be available to fund all the entitlements the left relies on to buy votes.

    Perhaps Tim could do a post on suitable jobs for former state trustafarians to do?

  2. The facility with which it is possible for you to demolish this man’s arguments is worrying…

    The thing that alarms me with his arguments is his simplistic linear understanding (or representation) of the facts. He hasn’t identified the issues from the facts.

    Facts:

    1) the universities are funded to the tune of 5bn a year by the BritGov

    2) Corporations pay “corporation tax” on profit. Profit = income – expenses.

    3) Perhaps on paper if corporations were to maximise their profit, they would pay £5bn extra a year of this tax.

    4) Most big UK companies choose to minimise their profit by aggressive re-investment into tax-deductables, such as research, without operating through tax havens. This saved money flows into the economy, directed at high Net Present Value projects which in turn grow the firm, increase sales taxes and employ more people who contribute their spending back into the economy.

    5) Britain is actually a massive gainer from inflows of “royalties” from overseas:

    http://www.worldmapper.org/display.php?selected=168

    It is absolutely not in Britain’s interest to attempt to regulate against such licensing arrangements

    After these facts, you ask the simple question:

    Is it worth taking on the risk to

    a) our own royalties flows
    b) our own corporate reinvestment into our economy

    in the hope of gaining £5bn a year which could then be spent on arbitrarily chosen pet projects?

    The author does no analysis at all on this question. It’s completely unstructured; just speculation about the relative quantities. It’s a waste of eyesight.

    (ps, perhaps my “facts” pretty much look like I wrote them on the back of a fag-packet in two minutes. Like Richard Muphy’s. That’s because I did: I am replying to a blog post, not trying to formulate tax policy as a living.)

  3. They’ll give it to (ie not take it from) big business and we’ll be the losers?

    Oh, I don’t think so. No, not at all; why just the other day I was noticing my Vodafone dividends come rolling in.

    No, I don’t think we’ll lose at all.

    The State will lose, relatively speaking, but since they’d only waste the money, who cares?

  4. The State will lose, relatively speaking, but since they’d only waste the money, who cares?

    Richard does! He really does! Because, you see, l’etat, c’est lui.

    in his own head

  5. is “giving” as in “giving to big business” the new word for “taking” as in “taking from big business”.

  6. In the style of Ritchie, I’ve worked out the tax gap for Stemcor Holdings Limited, the family business that Margaret Hodge has a 10% stake in. Their UK turnover is £2bn (out of £6bn) but based on their overall profits of £65m that implies expected UK taxable profits of £22m and so a clear UK tax gap of £5.6m (£22m x 26.5% = £5.8m less £157K).

    Like Starbucks, Stemcor has “international traders” based in Switzerland held through intermediate holding companies. They also have “marketing services” operations in the tax haven of Guernsey.

    Let’s get Mrs Hodge’s brother in front of the Public Accounts Committee.

    Interestingly on Ritchie’s blog he’s just agreed they should be challenged!

  7. JK: why on earth did you think Ritchie /wouldn’t/ challenge that? It’s precisely the sort of company he’s been slating; and as far as I’m aware he has no personal ties to Hodge beyond operating on something loosely resembling the same half of the political spectrum.

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