And, third, secrecy will of course remain because the fact that a tax authority knows who owns a company is irrelevant. Limited liability is a privilege granted by society and we all have a right to know who is using it, or not, on public registers.
Which society grants and which society has then right?
Does British society have a right to peer through the limited liability granted by Germany?
If it limits liability in the UK, then the UK government *but not Murphy* may claim that is justified in *seeking to* scrutinise it.
Otherwise totally wrong – limited liability only affects relationahip with one’s creditors, so Murphy has an entitlement to scrutinise the accounts and status *only* of people who owe him money – his union paymasters.
We each have our personal utility function, and Ritchie’s puts immense value on snooping around and being nosy. That’s why he puts him having the right to snoop into other people’s business ahead of normally more desirable things like everyone getting richer, the poor getting a better deal, and so-on.
Ritchie has a voyeurist relish of other people’s affairs.
Well, limited liability could be replaced with contract. Andy contracts with Bob for Bob to perform certain services for Andy with one of the terms of the contract Andy and Bob contract to being that any damages Andy claims against Bob are limited to a certain amount. If Andy doesn’t like this contract Andy can contract with Charlie instead who will allow Andy to claim greater damages.
Because you owe everything to the state the state has a right to every piece of information about you – it’s a mindset common to many totalitarian regimes.
Because you owe everything to the state the state has a right to every piece of information about you – it’s a mindset common to many totalitarian regimes.
“Mindset” is a bit strong, given that it’s Murphy we’re talking about…
And happy to see Murphy doesn’t understand the concept of limited liability any better than he understands the distinction between entities that are privately and publicly held.
Evidently, the only difference between being a CA in the UK and being a CPA in the USA is a matter of 30 to 50 points on an IQ test. You lot over in wog-land really should look into tightening things up a bit, you know.
Dennis
I agree – probably ‘attitude’ is a better word – apologies!
@ Dennis
Balanced by the 30 to 50 IQ point shortfall of US Actuaries relative to those in the original Faculty.
“Limited liability is a privilege granted by society”
No, it is a trade off to get people to take risks and grow their businesses.
Basically he’s a feudalist, isn’t he? At heart.
Isn’t the right of government to raise taxes a privelege granted by society
john77 said:
“limited liability only affects relationahip with one’s creditors, so Murphy has an entitlement to scrutinise the accounts and status *only* of people who owe him money – his union paymasters.”
Not even that. He can refuse to trade with them if they don’t give him access to their accounts and ownership information, but doing business with them doesn’t then give him the right to get that information afterwards if he didn’t ask for it beforehand.
@ Richard
Note that I said “entitlement” – not “right”
Murphy is the sort of person the Bottom Inspectors in Viz were modelled on.
john77 – “limited liability only affects relationahip with one’s creditors, so Murphy has an entitlement to scrutinise the accounts and status *only* of people who owe him money – his union paymasters.”
Except now we are liable to everyone’s creditors. Because the government will not let a pension fund go bust. You and me have to pay for it.
Murph is a loon but he does have a point. If you and I are essentially co-signing those pension funds, I think we do have an interest in knowing some more about the people whose good faith and credit we are guaranteeing.
The sensible solution is to get the hell out of the pension business. Pensions should be fully funded, portable, and in the hands of someone besides the business owner. I would suggest Australia’s system. With better options for people who want to look after their own pension needs.
Unfortunately, SMFS, Australia’s system is not working as well as it was supposed to. The idea that you compulsorily pay part of your wage into a personal account (superannuation, or just super in the local parlance) was well intentioned. The addition, much later, by a conservative government, that you should be able to choose where *your* money goes and how it is managed was even better (and as you say got it out of the hands of the business owner – for a long time businesses could mandate their own fund for employees). At least the money you’ve contributed remains yours, even as an asset after death.
But they are still accumulation funds, not defined benefit, and for various reasons most people still end up eligible for the government aged pension. Getting people off of which was the entire point.
And now we have an election coming up where both major parties have spotted the opportunity to raid the pot of gold under the rainbow (they always knew it was there, now is just a good time to sell the idea), under the guise of limiting tax concessions to the rich. Never mind that the whole point of super was that your money was locked away until retirement but in return it got taxed less. No, suddenly that’s a rort.
I suppose my point is that even in a system where you nominally own the money, it’s portable, and all that good stuff, if the State controls access they can still take it away.
I would suggest Australia’s system.
Provided it’s not called a “super”.
Pensions were always gong to be vulnerable to governments. Colossal sums of money hanging around for decades – sooner or later the thieves were going to get their hands on it ‘to invest’.
@ SMFS
You’ve got it wrong – the taxpayer is *not* on the hook for pension schemes. It is *&other pension schemes* who have to pick up the tab for defaults through a flat-rate *not risk adjusted* levy.
Have you heard of “moral hazard”? Every company has an incentive to underfund its pension scheme because its competitors (and its customers and ihs suppliers, but it’s the competitors who matter in this case) are liable for the shortfall if it goes bust. So a lot more schemes have gone bust since New Labour created the PPF (loud mutterings in the wings: “I told you so”).
The employer is required to show funding for DB’S schemes on its balance sheet. Information on its Corporation Tax liability is redundant here.
Interesting though that it isn’t enough for Murphy that the tax authority gets to see this information; he thinks the public should have the right to see this commercially sensitive information. He could always start by making it a requirement for any company seeking the Fair Tax Mark.
Also, when is that much awaited Fair Tax Mark for partnerships coming on line? One would almost think he didn’t intend it.