Hodge, who became the scourge of multinationals in her time chairing the Commons public accounts committee, said: “Who pays tax and how much they pay has moved from being an obscure issue only discussed by tax professionals to one of huge public concern which is of interest to everybody.
“We want to stimulate an open debate on the challenges and reforms needed to restore and maintain confidence in the fairness of our tax system.
“Raising the tough questions and breaking through the technical jargon, which in the past has created a veil of secrecy, is just what parliament should do.”
They’re talking about corporation tax.
Abolition of corporation tax is to be considered by a new cross-party group of MPs and peers who will subject ministers and business leaders to public interrogations in a bid to secure fairer and more responsible tax policies.
No, they won’t abolish it, which is what they should do.
With evidence growing that the current tax on profits is unfair and too easily avoided, the group wants to debate whether it should be replaced by a new tax on location of activity and sales.
They will recommend unitary taxation.
This is all pre-ordained.
Not one single one of them will even bother to consider the economics of this, nor even read the Mirrlees Report. Instead of taking the advice of a Nobel Laureate on the design of tax systems they will instead take their lead from a retired accountant from Wandsworth.
How well we are ruled, eh?
We already have a sales tax based on location, it’s called VAT.
This is the curse of being a Protestant society. An obsession with “reform”, that never ends.
Unitary tax; he tax that makes c-b-c seem week reasoned. Amongst it’s MANY flaws it skews taxing powers back to those countries with mature domestic markets and away from the activity. It makes in effect for a tax on employment, which is absolutely bound to accelerate any ‘race to the bottom’ they claim they are fighting against.
They are fuckwits.
Tax is a two way affair, one side is collection, the other side is spending. No coincidence that the people who perform the latter are concentrating on the former, it is a distraction. “Fair Tax” includes fair _spending_ of tax, and whilst the current tax spenders refuse to bring their own house in order, they have no right to demand anything of the tax payers.
“With evidence growing that the current tax on profits is unfair and too easily avoided”
Such as by not making a profit, for example.
“With evidence growing that the current tax on profits is unfair and too easily avoided, the group wants to debate whether it should be replaced by a new tax on location of activity and sales.”
But still surely based on profit? Or are they going for VAT mark 2?
I think they really are stuck with this basic problem that there’s very little left to tax.
And hope are they going to determine the location when you have customers in one country, software developers in another, servers in a 3rd…
In that regard, I think we’ve moved into a phase now where HMRC aren’t bothered about getting their assessment of your condition correct. If they decide you owe it, you owe it. The rule of law is soooo last century.
“public interrogations” ah, the bread and circuses of expensive prosecution, rather than the hard graft of effective tax policy. Same as it ever was.
Also, who gives a shit about ‘fair’? I won’t, until someone brings in an x-factor tax.
“If they decide you owe it, you owe it.”
Ah yes, the Revenue Canada approach: a bunch of burly “inspectors” descend on your office and inflict an extensive audit (consisting mostly of eating muffins and drinking coffee) and are generally obnoxious to the entire finance department, until the finance director agrees to the figure they dreamt up when they saw the CEO’s car in the parking lot. Allegedly.
This debate is an exercise in wankery.
The majority of the proponents of “Fair Tax” are simply trying to say that we have a tax collection problem rather than an Addiction-to-spending problem.
Which as anyone who follows politics in the west knows is firstly bollocks, and secondly going to lead to our eventual downfall.
Buy ho-hum as they say…
“In that regard, I think we’ve moved into a phase now where HMRC aren’t bothered about getting their assessment of your condition correct. If they decide you owe it, you owe it. The rule of law is soooo last century.”
I’m afraid that’s nonsense. International taxation is about WHERE the profits are taxes; not if. Unitary Taxation is about unpicking the existing principle of finding whee value is created and added to, underpinned by transfer pricing, and replacing it with the prejudices of lefty arseholes like Sol Piciotto.
Then there is the little matter of legal process and the courts, which multinationals certainly can and do access.
The government can pass a law which imposes taxes as long as it is not in breach of an international treaty. DBC Reed could impose a 50% pa tax on the capital value of all warehouses that could be offset against corporation tax. That would be perfectly legal.
Eddie Stobart would not be happy but he hasn’t got a vote any more.
Of course (as I expect most readers will know), ‘Enver’ Hodge has a small but significant stake in her family (Oppenheimer) company Stemcor – a global steel business with a London HQ.. Last time I looked at their published accounts, they had a turnover of around $10 billion, but paid a relatively tiny amount of CT, for the very good reason that they didn’t make much profit.
Since, unlike (say) Amazon or Starbucks, the public don’t directly buy Stemcor’s product, there’s little chance of the Corbynistas calling for a boycott – what are they going to do, refuse to enter any structure built using Stemcor steel?
I was responding to this silly comment:
“In that regard I think we’ve moved into a phase now where HMRC aren’t bothered about getting their assessment of your condition correct.”
Your reference to warehouse taxes, whilst interesting and indeed correct, is a non sequitur.
Sorry, hadn’t realised what you were replying to
Make no.mistake, I do agree with you.
All this argument about fair taxation never gets to the point and defines “fair” in the context of taxation.
Oh but it has been; ‘fair’ is what Murphy wants today…and he wants it now!
given all the talk of transparency and public debate it’s interesting that they haven’t mentioned the international treaties that bind the UK when it comes to tax, as already mentioned the outdated exemption on warehouses counting as a presence in a country for tax purposes. Not just a simple matter of changing UK laws/rules independent of other countries.
Multinationals can indeed send teams of lawyers into the courts. Not so for the smaller fry that HMRC will enjoy making examples of. Regulatory burdens are always more tolerable to very large corporations than smaller ones, a fact recognised by many economists.
Runcie Balspune – ““Fair Tax” includes fair _spending_ of tax, and whilst the current tax spenders refuse to bring their own house in order, they have no right to demand anything of the tax payers.”
The Mail is reporting that the Environmental Agency decided to flood York because they were afraid that water might get into their pump rooms and so reduce their ability to pump the water out should, you know, York get flooded.
Now the Mail may be wrong, but some questions arise in my mind. Like who builds their pumping station somewhere it is liable to be flooded if it rains? Or what if it did? Isn’t it better for their electrics to get wet than the whole of York to be under water? Isn’t it better to lose the pumps than to flood York and then have to pump it out again?
All of which comes back to your point. I have never been prouder to pay British taxes. Knowing that they are going to pay people to protect against flooding but aren’t bright enough to actually do it.
F**k ’em all. And the horses they rode into town on. I am never going to vote to convict anyone for any tax offense at all.
Unitary Tax is aimed at the multinationals. As Ritchie would say: that is all.