This is all very amusing indeed. Following on from the Guardian\’s original allegations and the subsequent writ for libel, The G has now published two pieces explaining the whole situation. Here and here. And a leader here.
The complex tax avoidance structures erected by Tesco were not about avoiding corporation tax, as we thought and claimed, but about the avoidance (together with the purchaser) of SDLT. Nor – over the £5bn of planned property disposals – would Tesco avoid "up to £1bn", as we had thought possible.
But the part that I think is so very amusing is this:
Griffiths has an advantage over most City reporters in that he is a qualified chartered accountant.
So, umm, how come he managed to make such a horlicks of the investigation then?
There is, however, one more point, which raises this story from most and very amusing to positively hilarious.
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."
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.
That is that the Guardian Media Group, the owner of The Guardian, was setting up exactly the same system, exactly the same scheme, as our intrepid reporters were accusing Tesco of doing. It\’s not just that issue of the biter bit: it\’s that to work out what was happening they only had to phone up their own accountants to get the full story.
As I say, positively hilarious.
One further point: The G doesn\’t in fact mention that it is using exactly the same schemes itself. Wonder why?