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It’s glorious, innit?

Despite all that is going on in the world, Labour thinks that sweet shops are the big issue that it needs to tackle, and that this issue was worth a Christmas press release.

Talk about distraction activity.

The sweetie shops story is actually one of tax evasion. Not even avoidance, full on evasion.

Leave a shop empty for long enough and you’ve got to pay the rates on it – landlords don’t like that. So, often enough it’s possible to get a shop on a short term rental nice and cheap – the landlord doesn’t get much rent but also doesn’t have to pay those rates.

The sweetie shop gets cheap rent – but does have to pay those rates. But if you fold the Ltd company quick enough, shuffle the assets through a pre-pack, then you can – often enough – avoid paying those rates too. So, you’ve not a near free shop on Oxford St from which to rooks the tourists.

This is not some secret, this is written about in the national press. But that bloke who has spent two decades as a tax campaigner thinks it’s just a distraction, right?

23 thoughts on “It’s glorious, innit?”

  1. Labour to crack down on ‘dodgy’ candy stores in push to revive high streets

    We desperately need more retail space for charity shops and Turkish barbers.

  2. Bloke in North Dorset

    Flogging dodgy goods as well.

    I’m fairly sure we have laws against tax evasion and flogging dodgy goods. As these are both local issues how about the local governments that are mostly Labour controlled actually doing some work?

  3. I’ve been told that the candy stores are just fronts for drug money. A friend of mine runs a restaurant in a small provincial Welsh town, where everyone knows everyone. There’s one of those candy stores in the town centre, and no-one is ever seen in it buying anything, but its been there for years. The locals say that its owned by the guy who owns the local nightclub, and some of the money from drug sales in the nightclub gets laundered through the sweet shop.

  4. How do you launder money through a business with near-zero turnover? I’m not doubting they’re dodgy, but I don’t understand how the dodge works. Ditto Turkish barbers.

  5. The shop doesn’t have near-zero turnover, like the Turkish barbers, (or mini-cab firm) it is a goldmine of “customers” who pay in cash. You just never ever see these customers of course, because they aren’t real.

    Money Laundering 101

  6. Bloke in North Dorset

    I’ll try again ..


    That sounds like one of those situations where the police know what’s going on and it suits them not to break it up and let the criminals police themselves within tolerable margins. Better the devil they know.

    Not dissimilar to when we were kids and under age drinking. The police knew exactly where we were, not on street corners or other locations, and they knew the landlady was keeping us on the straight and narrow. The landlady knew we were under age, or I was at least because she was my mum’s best friend.

  7. Dennis, Pointing Out The Obvious

    All you have to do is look at a photo of Richard Murphy to realize he has a soft spot for sweet shops.

  8. @Jim
    I’ve heard a lot of theories about various businesses being used for money laundering. Very few of them stand up to examination.
    Let’s think about what you’re trying to achieve. You have a pile of cash that you want to legitimise by paying tax on it. So you need a business has a large amount of cash flowing through it, you can insert your illegitimate cash into without it being noticed.
    It really isn’t easy, bearing in mind the anti-money laundering provisions being made. That’s the authorities & the banks. They generally have a pretty good idea what the money flow through businesses should look like. Both volume & proportion cash/card payments. Depart too far from that, you stick out like a sore thumb.
    In the example you mention, the nightclub would probably be a better laundry than the shop. A lot of cash going over the bar & quite difficult to work out what is genuine customer spending & what isn’t. All that’s required is to ensure that the club’s spending on consumables (the drinks) matches what supposed to be coming over the bar. You can dispose of the surplus booze by selling it on or even pouring it down the drain. You’ve sufficient profit margins to do that. Far harder to do that with confectionery. I doubt on the “Turkish” barbers, as well. That may be more about providing apparent legitimate employment. Still a form of money laundering but the cash source is different.

  9. I always assumed the American sweet shops and particularly the Turkish barbers were not so much fronts for money laundering as hubs for drugs, prostitution, protection and maybe a bit of fencing. The nail bars and Chinese massage parlours seem like slavery with presumably a few happy endings thrown in. Not sure about the vape shops, maybe it’s a case of knowing what to ask for?

    I also agree 100% with BiND that our constabulary leave the hard nuts to police themselves within reason so they can concentrate on softer targets. Traffic wardens are also savvy enough to ignore the flashy SUV’s parked on pavements outside these establishments

  10. @John
    Chinese massage parlours seem like slavery with presumably a few happy endings thrown in.
    We dealt with this fantasy some years back. You cannot make money out of forcing people to do something when there’s a surplus of people will do it willingly. There is absolutely no limit to the number of women wish to monetize the asset they’re sitting on. The limit is in the number of men willing to pay for it. Even if you’re paying the girls nothing, the costs of forcing them to do the work will push the price of the service higher than what the willing girls will be asking. Thugs don’t come cheap on day rate but the willing girls only earn when they work.
    I’d imagine the same applies to nail bars & other fantasy areas. There’s no shortage of girls want to apply false nail & varnish them. The shortage is in the number of women want their nails done.

  11. I understand that sales tax and how much has to be declared on the room fees vs the tip for the ‘massage’ is something of a contentious issue, it’s sometimes surprising what people will tell you when they find out you used to be an accountant. I’m pretty sure someone concerned over tax details isn’t an unwilling participant (apart from in the tax regime that is)
    I presume as well as skipping out on rates the sweet shops also skip out on the VAT

  12. BiS

    A business like a sweet shop can sign a 6 or 12 month lease and be long gone and the company luquidated before HMRC even realise that they existed. The local council’s trading standards might take an interwst, but only if someone complains.
    As for Jim’s shop, I couldn’t say, but if it kept its turnover low enough and paid its tax and rates, no one is going to care. When I owned a business I made sure that I paid some NI and didn’t obviously take the piss with VAT refunds. These were costs that I could easily absorb and as a result the authorities left me alone. Not once in 20 years did they come and have a word with me.

  13. @Otto
    Yeah. As Tim said. Fly-by-night business. Open & trade on very little outlay & be gone before the costs catch up with you. That’s a tax evasion scheme.
    Otherwise, you have to remember you’re the other way round from running a legit business. You’re trying to pay tax that you do NOT owe. Favourite is some sort of service. Bar is such because the input of materials – the drinks – are such a small proportion of what the customer pays. And bars take in a lot of cash. 20 – 30% of your turnover could be laundering without anyone noticing. Busy bar I use is seeing 20-30 euros a minute crossing the bar, average over the session. So, even before the laundering, you’re benefiting from a profitable business.

  14. Up till January 2021, I understood one purpose of the Turkish Barbers and similar were to enable benefit claims by those who’d recently gained EU national status. Also optimises your benefits package if you’ve recently acquired UK leave to remain.
    To claim UC as an EU national and the related help with housing costs you had to be doing 24+ hours of work. The amount of benefits paid was still worth it even if the social presumed 24*NMW as your weekly income in their calculation of your UC when your actual earnings were half that.
    The way to check this would be to see if the number of such businesses has flatlined since free movement and the income floor came in for immigrants which I haven’t checked.

  15. Former Metropolitan Police officer Ali Hassan Ali told The Mail on Sunday there had been a boom in barber shops opening since the pandemic.

    “A lot of these shops have thousands of pounds of equipment but no customers,” he said.

    “While in some cases the shops will be involved in legitimate business, from my own experience, there is strong reason to believe a large number, particularly those owned by Albanians, Turks and Kurds, have links to organised crime.”

  16. A car repair garage is much better for money laundering. Clients who surprisingly want to pay with cash. Lots of expensive repair bills and amazingly low outgoings as parts are rarely needed and the few mechanics employed work really fast for low wages.

  17. Well the personal testimony of a single police officer suspiciously named Ali is interesting.
    But according to the
    industry federation
    the number of barbershops grew 64% in the 5 period 2014-2019.
    Fast forward to the same federation’s 2022
    and the progression has changed – they say hair and beauty businesses have risen 5%, that “the hairdressing and beauty workforce declined by around 24,500” and “The number of
    hairdressing, barbering and beauty businesses continued to grow but at a slower rate than previously”.
    The piss-taking no doubt continues, but the rapid expansion needs to be traced back to 2014 and probably earlier. I blame Lord Cameron ‘cos he bombed Libya and Syria so he’s fair game imv.

  18. @Andyf I’ve used car mechanics under railway arches for decades and have never paid other than cash. Even today I don’t think any of them have card readers. And I’m talking about proper, greasy-overalls mechanics.

  19. A friend of a friend (yeah, I know) confirms the barber shop thing is more benefits and residency manipulation than money laundering. It gets you through the ‘no recourse to public funds’ probationary period, the ‘go home if you have no work’ rule, and once settled it gets the national insurance payments started up. It can be worth it for a 20-something sit around bored for a few years to get legally integrated into “the system”.

    It also keeps them off the streets, forces them to keep their nose clean and avoid voiding their visa, etc., and the extended period of avoiding being a dick causes “normal” societal rules to rub off on them as they get into the habit of not being a dick. I think there’s possibly a net positive compared to the illiterate illegals working in the curry house that gets raided every couple months and deported.

    In the illegal migration argument I keep arguing “look, it’s so much cheaper to just *****ing *pay* for a normal work visa and buy a perfectly normal ‘plane ticket – not to mention legal and SAFE!”

  20. BiS

    I see all corporate taxation as a kind of protection racket. As long as I paid for the fruit machine Ronnie and Reggie wouldn’t come around and duff me over.

  21. Agreed with BiS. If you’re doing money laundering at all properly, you need to make it look legitimate, at least at first glance. So if you’re claiming £Xk of sales, you’ve got to have some industry-standard percentage of £Xk as stock purchases, all properly documented, preferably from a legitimate supplier. And if it’s a sweet shop, what do you do with that many sweeties?

    At least with a pub you can drink the excess, although I’m sure we’ve all seen dodgy-looking middle-aged gaffers who’ve gone down that route and it doesn’t end well, but at least you can see why it seemed like a good idea.

    But unless your criminal gang leader is 8 years old, what do they do with the sweeties?

    That’s why it’s traditionally money “laundering” – a few packets of soap powder don’t cost much or take up much space.

    (plus you can put all the gang on the payroll, giving them a legitimate-looking source for their income too, but that’s a side benefit)

  22. As we’re talking MandMs and similar products. Then smuggling abroad, handing out to dodgy corner shops or dumping them shouldn’t be too difficult.

    You’ve seen in The Great Escape where the late David McCallum invents special trousers for disposing soil from the tunnel ? Well just crush up the sweets…

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