Ritchie on the taxation of Barclays profits

UK headline profits tax rate is 23%. Barclays paid 28.9% of profits in corporation tax last year.

Ritchie claims that this is evidence that Barclays is avoiding tax on its profits.

Go figure.

8 comments on “Ritchie on the taxation of Barclays profits

  1. He’s a horrible little hypocrite. Barclays are paying a higher rate than the UK, so now the problem is that they aren’t paying enough in the UK itself (despite Barclays making a loss in the UK. Go figure).

    Yet he constantly argues that multinationals use tax havens to shift profits out of developing countries, like South Africa where Barclays are paying lots of tax to low tax jurisdictions. He mouths off constantly about it when talking about BEPS.

    So on one hand Barclays have shifted profits to higher tax rates, which he attacks, but then would attack them if they shifted profits to low tax jurisdictions. How he manages to get this straight in his head I don’t know, but you simply can’t make it up.

    As far as I can tell his logic is this simplistic:

    1. Tax havens are bad.
    2. Barclays use tax havens.
    3. Barclays are bad.

    His article points out the massive holes in CbC. It simply doesn’t give you any more useful information, and it doesn’t do what it sets out to do. It certainly doesn’t give you enough information to determine if his favourite mantra of “the right amount of tax in the right place at the right time” has been achieved. You’d need a full breakdown of transactions to do that.

  2. I totally agree with Tyler. He is motivated by a hatred for Barclays so much that all previously stated principles get turned on their heads if needed to attack Barclays. He pulled the same trick about a year ago when he argueed that interest paid overseas, even if to a higher tax jurisdiction like Germany was avoidance because it wasn’t being paid here. His socialism has a distinctly, er, national flavour.

  3. For sheer gall, however, this takes the biscuit: “Barclays is employing people who would otherwise be employed elsewhere. The NIC would happen in another company if not Barclays. The same may be true of the VAT -”

    The self styled champion of civil society, of the living wage, of the poor, is basically saying, “who cares if this business that I hate takes it’s activities somewhere else and their employees are laid off. Employment levels are fixed – because I want them to be for the next 5 minutes – so they can go and find jobs elsewhere.”

    Does he I wonder say the same each time he hears of a factory relocating to another site or PCS, sorry, HMRC staff numbers being reduced? Of course he bloody doesn’t.

    Hypocrite, hypocrite, hypocrite.

  4. @ Ironman

    Barclays are cutting 14,000 jobs. In Ritchielogic this means they will all suddenly appear in another bank doing exactly what they were doing at Barclays.

    In reality, they are cuts. I personally have/had been chatting to them about a trading job there, and it’s been put on hold for the moment because of said cuts, and are going to keep the junior staff currently in the position and not hire at director level. Just in my sector of the markets they’ve gone from 4 director level people with 4-6 junior traders down to no director level traders and 4 juniors.

  5. What’s so utterly frustrating is Ritchie’s absolute refusal to believe that a company, its auditors and HMRC have a better understanding of all the intricacies and mechanics of its structure and business than he does.

    He complains that publicly published accounts aren’t transparent and don’t provide enough information. He then goes on to torture these very same accounts in order to derive his own conclusions, and no amount of discussion can convince him he may be wrong.

    A lesson learned early in my career: I was part of a team who had a regular task to go through the FSA returns of our competitor insurers. Every year there was one company whose entry in one particular item confused us, as it appeared to be so out of line with the rest. We had all sorts of speculative ideas about why this was the case. We couldn’t understand it until someone from the company concerned joined us and explained that it all arose from a quirk of their company structure, but that both auditor and regulator were completely happy with it.

    And yet Ritchie expects to dissect a global company like Barclays from his bedroom!

  6. One day he’d going to push one of his unfounded accusations too far, and the accused will take the bait and instruct lawyers.

    I hope that day is today.

  7. Judging by his condemnation of others, he must have been the world’s most rigorous of auditors.

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