And Tee Hee Hee indeed:
I\’ll begin with my former employer, the Guardian Media Group, following its flagship paper\’s investigation last week into Tesco\’s use of tax efficient Cayman Island vehicles.
That one drew quite a bit of flak from those Farringdon Road firebrands, with a Guardian leader thundering: "The Government should make it clear that paying a fair share of taxes is not an option but a duty."
Odd, then, that buried on page 25 of yesterday\’s paper was the following notice: "Guardian Media Group plc, parent company of the Guardian, in partnership with Apax Partners, has incorporated a new company registered in the Cayman Islands as part of its proposed acquisition of Emap plc."
A spokesman from GMG is then quoted as saying: "The tax arrangements of Apax Partners and GMG for the acquisition of Emap plc are completely legitimate, and are based on accepted practice and the recommendation of our advisers. This is not about GMG avoiding tax – indeed we have paid an average of 34pc tax over the last five years."
Fair enough, although I prefer last week\’s words from the newspaper\’s star columnist, Polly Toynbee.
She argued: "Tesco\’s Cayman Islands tax arrangements reminds the world that our tax lawyers are world-beating at \’tax-efficiency\’. When such an emblematic company takes such steps, it speaks volumes about national tax avoidance culture." Ho-hum.
GMG\’s statement raises one obvious question. As the move isn\’t about avoiding tax, can we assume that the company is paying at least as much duty on this deal as it would have done had it never engaged with the Cayman Islands?
A GMG spokesman waffles on about paying the same amount of corporation tax as if the bidding vehicle were a UK-registered company, before reiterating that "the deal is structured as a UK Scheme of Arrangement so no stamp duty is payable on the acquisition". Sounds like less tax to me, then.
My thanks to George in Baghdad for the spot.
Let\’s see what Richard Murphy, Prem Sikka and Polly T all have to say about this, eh?