blandy Posted March 20, 2014 Moderator Share Posted March 20, 2014 Part of the budget yesterday contained proposals that HMRC will be able to force people to pay disputed amounts of tax up front, then get it back if they eventually win their case years down the track (ie, the oppoiste situation to now)...... The idea that the government is either soft on avoidance, or is getting the Big 4 to help them draft legislation full of holes is nonsense. Question, Mart - is that people as in "individuals" or does it mean "Companies and individuals of all standing and size"?. And how does that affect the likes of Amazons and Googles and all those Caymen island funds and so on? What measures have either this lot, or their predecessors taken to actually stop the huge levels of avoidance and evasion that we know are going on? A proposal to make people pay disputed amounts doesn't in itself sound like "that's the lid on that sort of behaviour". It sounds like "we'll catch a few builders and plumbers, who we've decided to treat as guilty unless they can prove they're innocent". 1 Link to comment Share on other sites More sharing options...
Risso Posted March 20, 2014 Share Posted March 20, 2014 Part of the budget yesterday contained proposals that HMRC will be able to force people to pay disputed amounts of tax up front, then get it back if they eventually win their case years down the track (ie, the oppoiste situation to now)...... The idea that the government is either soft on avoidance, or is getting the Big 4 to help them draft legislation full of holes is nonsense. Question, Mart - is that people as in "individuals" or does it mean "Companies and individuals of all standing and size"?. And how does that affect the likes of Amazons and Googles and all those Caymen island funds and so on? What measures have either this lot, or their predecessors taken to actually stop the huge levels of avoidance and evasion that we know are going on? A proposal to make people pay disputed amounts doesn't in itself sound like "that's the lid on that sort of behaviour". It sounds like "we'll catch a few builders and plumbers, who we've decided to treat as guilty unless they can prove they're innocent". Sorry Pete, but that's entirely wrong. There's an entire separate section yesterday about multinationals, transfer pricing and intra-group profit shifting, which if you're so minded you can go and read. The bit I'm talking about though is that there are nearly 70,000 open tax enquiry cases, and the government are going to bring in what is effectively retrospective legislation to collect the money in dispute, amounting to about £7bn. These aren't plumbers and builders doing cash jobs, but the Jimmy Carr types who are saving tens of thousands of pounds each. This is on top of things like GAAR, Offshore and Onshore Employment Intermediary legislation, FATCA and so on. Link to comment Share on other sites More sharing options...
blandy Posted March 20, 2014 Moderator Share Posted March 20, 2014 It was a question, more than a statement, Martin. Thanks for the answer. Link to comment Share on other sites More sharing options...
peterms Posted March 20, 2014 Share Posted March 20, 2014 This is on top of things like GAAR, Offshore and Onshore Employment Intermediary legislation, FATCA and so on.FATCA is almost a good name for a tax initiative. 2 Link to comment Share on other sites More sharing options...
Risso Posted March 20, 2014 Share Posted March 20, 2014 The idea that the government is either soft on avoidance, or is getting the Big 4 to help them draft legislation full of holes is nonsense. Yeah, everybody wanting to fly from the Isle of Man to London is doing so because of tax avoidance. The stupid racist. The real reason for BA increasing their flights to the island is that Flybe have just stopped most of theirs. 2 Link to comment Share on other sites More sharing options...
Risso Posted March 20, 2014 Share Posted March 20, 2014 It was a question, more than a statement, Martin. Thanks for the answer. Yes sorry, didn't phrase my reply very well. The point is though that "this lot" have done an awful more than "the last lot" in cracking down on tax avoidance. Link to comment Share on other sites More sharing options...
Dr_Pangloss Posted March 20, 2014 Share Posted March 20, 2014 What other possible reason could you have for going to the Isle of Man? Link to comment Share on other sites More sharing options...
andyjsg Posted March 20, 2014 VT Supporter Share Posted March 20, 2014 I would go for cycling.... Link to comment Share on other sites More sharing options...
thetrees Posted March 21, 2014 Share Posted March 21, 2014 Part of the budget yesterday contained proposals that HMRC will be able to force people to pay disputed amounts of tax up front, then get it back if they eventually win their case years down the track (ie, the oppoiste situation to now)...... The idea that the government is either soft on avoidance, or is getting the Big 4 to help them draft legislation full of holes is nonsense. Question, Mart - is that people as in "individuals" or does it mean "Companies and individuals of all standing and size"?. And how does that affect the likes of Amazons and Googles and all those Caymen island funds and so on? What measures have either this lot, or their predecessors taken to actually stop the huge levels of avoidance and evasion that we know are going on? A proposal to make people pay disputed amounts doesn't in itself sound like "that's the lid on that sort of behaviour". It sounds like "we'll catch a few builders and plumbers, who we've decided to treat as guilty unless they can prove they're innocent". Sorry Pete, but that's entirely wrong. There's an entire separate section yesterday about multinationals, transfer pricing and intra-group profit shifting, which if you're so minded you can go and read. The bit I'm talking about though is that there are nearly 70,000 open tax enquiry cases, and the government are going to bring in what is effectively retrospective legislation to collect the money in dispute, amounting to about £7bn. These aren't plumbers and builders doing cash jobs, but the Jimmy Carr types who are saving tens of thousands of pounds each. This is on top of things like GAAR, Offshore and Onshore Employment Intermediary legislation, FATCA and so on. My company(the one that I work for) was the subject of an aggressive investigation regarding transfer pricing a few years ago. This was a result of us turning a loss making company of several years into a profit making one that actually paid corporation tax. My business is relatively small, having grown from one person (me) to the four full time salaried workers of today. Although we defeated HMRC on all counts, had we been required to pay the 'accused' amount upfront, while the investigation was under way, we would have just shut down the UK operation, leaving the staff paid off and me to commute to Europe. My history with HMRC is a victory and creditable draw (moral victory) and I can vouch for the fact that they have a machine gun approach which results in them regularly running up blind alleys. 1 Link to comment Share on other sites More sharing options...
peterms Posted March 21, 2014 Share Posted March 21, 2014 Yeah, everybody wanting to fly from the Isle of Man to London is doing so because of tax avoidance. The stupid racist. I think you'll find the Isle of Man race is something involving motor bikes, not an ethnic group. Link to comment Share on other sites More sharing options...
Risso Posted March 21, 2014 Share Posted March 21, 2014 What other possible reason could you have for going to the Isle of Man? We live here? Link to comment Share on other sites More sharing options...
Risso Posted March 21, 2014 Share Posted March 21, 2014 (edited) The close relationship that the four firms enjoy with government creates a perception that they wield undue influence on the tax system which they use to their advantage. They told us that they second staff to government to provide technical advice on changes to tax laws and that this has improved the quality of legislation. The witnesses conceded that this may give the perception that they are able to influence legislation to help their larger clients to the disadvantage of smaller UK businesses. More worryingly, we have seen what look like cases of poacher, turned gamekeeper, turned poacher again, whereby individuals who advise government go back to their firms and advise their clients on how they can use those laws to reduce the amount of tax they pay. House of Commons Committee of Public Accounts, "Tax Avoidance: the role of large accountancy firms", 15 April 2013, here. (link opens pdf) Classic Hodge (I shall start by declaring an interest, in that I was employed by PricewaterhouseCoopers many, many moons ago) nonsense. The woman is a moron, and I don't know how she manages to dress herself in the morning. Take her opening question to somebody from KPMG: "They are paying the fees to help minimise their tax bills on that spectrum of planning, avoidance, evasion." Yes, people are paying a Big 4 accountant for helping with evasion. Somebody with her lack of knowledge on her own family group companies and trusts, and with so little intelligence shouldn't be allowed to be in charge of a pet hamster, let alone a Parliamentary committee. Edited March 21, 2014 by Risso Link to comment Share on other sites More sharing options...
peterms Posted March 21, 2014 Share Posted March 21, 2014 Classic Hodge (I shall start by declaring an interest, in that I was employed by PricewaterhouseCoopers many, many moons ago) nonsense. The woman is a moron, and I don't know how she manages to dress herself in the morning. Take her opening question to somebody from KPMG: "They are paying the fees to help minimise their tax bills on that spectrum of planning, avoidance, evasion." Yes, people are paying a Big 4 accountant for helping with evasion. Somebody with her lack of knowledge on her own family group companies and trusts, and with so little intelligence shouldn't be allowed to be in charge of a pet hamster, let alone a Parliamentary committee. I don't have much time for Hodge, she's one of the Blairite careerists who have used the Labour Party as a vehicle for their personal ambition. Grandstanding has been her stock in trade since when she ran Islington and used to lecture other London authorities on what they should be doing, while presiding over one of the worst networks of child abuse in childrens' homes. But here, she is merely the mouthpiece for the committee. In turn, they are doing no more than reflecting a lot of work done by many people over a long period to expose the insidious way that the big 4 firms of accountants have infiltrated the machinery of government for their own gain and that of the wealthiest people in the land. The issue becomes no less significant or objectionable simply because someone like her tries to get a bit of reflected credit by discussing it. 1 Link to comment Share on other sites More sharing options...
Risso Posted March 21, 2014 Share Posted March 21, 2014 Just read that document though Peter. You can't bring in an initiative like "Patent Box" then not expect professional advisers not to tell their clients how to use it! What was the purpose of the legislation - to reduce tax for people developing innovative products and to therefore presumably promote the UK as place for innovative people to do business. Are people who run businesses going to understand the legislation without having it explained to them? Of course not. Who are they going to turn to to explain it to them -their professional advisers. The Big 4 were very much into promoting avoidance years ago, but knowing several Partners of Big 4 firms over here, these days it really isn't the case. They will always try to help people to minimise their tax of course, but that's different from exploiting loopholes. I take your point about Hodge, but if you are going to investigate the tax affairs of big business, then it should be done by somebody with a passing knowledge of what she is talking about, and who isn't just there to grandstand. I still remember her questions to the Google director. "Why don't YOU live in Dublin?!" His stunned, incredulous face was a picture. I know that individuals can be compelled to appear before the Dodge, but is their a requirement to be civil to her? I wouldn't be. Link to comment Share on other sites More sharing options...
jonno_2004 Posted March 21, 2014 Share Posted March 21, 2014 What other possible reason could you have for going to the Isle of Man? Having spent 17 years out of my 24 in the UK, I can think of a fair few.. Link to comment Share on other sites More sharing options...
blandy Posted March 21, 2014 Moderator Share Posted March 21, 2014 The Big 4 were very much into promoting avoidance years ago, but ... these days it really isn't the case. They will always try to help people to minimise their tax of course, but that's different from exploiting loopholes.... Now that doesn't sound credible in the slightest. Expert tax accountants deliberately ignoring loopholes when advising people who pay them money to save themselves from paying more tax than they are required to. It just sounds....non-credible. Link to comment Share on other sites More sharing options...
Risso Posted March 21, 2014 Share Posted March 21, 2014 That's not quite what I said Pete. Years ago they were actively marketing products they devised themselves to get around loopholes. They don't do that very much these days. Link to comment Share on other sites More sharing options...
peterms Posted March 24, 2014 Share Posted March 24, 2014 Duncan Weldon on Minsky, R4, 20.30 tonight and iplayer later. Supporting article here. Link to comment Share on other sites More sharing options...
blandy Posted March 24, 2014 Moderator Share Posted March 24, 2014 The Big 4 were very much into promoting avoidance years ago, but ... these days it really isn't the case. They will always try to help people to minimise their tax of course, but that's different from exploiting loopholes.... Now that doesn't sound credible in the slightest. Expert tax accountants deliberately ignoring loopholes when advising people who pay them money to save themselves from paying more tax than they are required to. It just sounds....non-credible. That's not quite what I said Pete. Years ago they were actively marketing products they devised themselves to get around loopholes. They don't do that very much these days. Yes, I'm sure they don't make it quite so open, what with the mood being a bit tetchy about corporate tax avoidance and all that. But they'd not be doing their jobs if they didn't advise on the, ahem, pros and cons of various "gaps" in tax legislation, and they'd lose clients. People don't pay them all that money for moral viewpionts, after all. Link to comment Share on other sites More sharing options...
mockingbird_franklin Posted March 25, 2014 Share Posted March 25, 2014 Interesting to see the Bank of England explaining that economics textbooks are wrong to state that bank lending comes from deposits. BoE explicitly recognises that making loans creates new money out of nothing, and the "money multiplier" model is wrong. What next? Asking the question "So why do we allow private banks to create new money at will and charge interest on it?" Or "What if the Government were to create this money, instead of pretending they had to "borrow" it?" It's a slippery slope... Guardian today... Evidence points to this being only partially true, the whole truth as purposed is worse, new money is indeed created as an IOU when loans are taken out, more specifically as a promissory note (Bank of England notes are nothing but promissory notes, irredeemable promissory notes), which are treated as cash for accounting purposes, and the loan 'customer' creates the promissory note, hence the customer creates the money with their signature. The bank treats it as a gift,to them from the customer and then loans it back to the customer at interest and with the supposed principle also repayable. Effectively the bank provides a currency exchange service, exchanging the money you create (your promissory note) into bank digital money, which in turn is interchangeable for legal tender Bank of England promissory notes. The cat is out of the bag regarding how banking works, maybe half admitting the scam will keep a cap on it, Think it through, when you sign a loan contract you are Promissing to pay a set amount of other promises to pay, this second set of promises to pay being nonredeemable, pretty absurd isn't it. Link to comment Share on other sites More sharing options...
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