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Surprises the hell out of BP and Shell

The secondary role of tax in the government’s funding cycle is to provide the government-created currency of a jurisdiction with value in exchange. That happens because if the tax owing to a government can only be settled using the currency that government creates those transacting in that economy who are likely to have tax liabilities arising as a result will not be able to afford the exchange risk arising from trading in any other currency.

Both BP and Shell trade extensively in $. And pay UK corporation tax in £.

So, err?

4 thoughts on “Surprises the hell out of BP and Shell”

  1. Pretty sure that any change in the US/£ exchange rate will make the FTSE 250 move. Not just Shell and BP.

  2. Hmmm Isn’t the Potato operating on his notion that any economic activity within the State is property of that State?

    His inner communist is showing again…..

  3. I think Murphy meant to say “trading *solely* in any other currency” … but that, however, begs the question “why should such an entity owe taxes to that government?”
    Anyhow he’s just plain wrong – any profitable company trading solely in Swiss Francs would have been quids in during Wilson’s premiership and no-one (well, no-one sane and intelligent) considered that Swiss Francs involved a downside exchange risk.

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