Monday, 17 November 2014

Government`s hypocrisy over tax avoidance

After the verbal chicanery delivered by Osborne recently over the EU`s demand for £1.7bn, it`s not surprising to see that being forced to scrap his tax reducing enticement vehicle, the "patent box", is somehow "a great deal for Britain".  The "incentive" was designed to encourage companies to Britain, as they would only have to pay a maximum of 10% corporation tax, so avoiding higher tax elsewhere. As its gradual removal has been brought about largely by Germany "arguing that it encouraged artificial shifting of profit", could we ask the Germans to complain too, about the behaviour of this country`s "Big Four" accountancy firms? Used by our government  on Treasury tax committees, they then find ways for companies and individuals to avoid tax, with their payment being a percentage of the taxes saved. Deloitte, one of the "Big Four", issued a pamphlet last year which stated that for every £1m of income in the UK, £165,000 of cash tax can be saved! Yet, the government continues to award these firms massively lucrative contracts, and doesn`t even insist on the return of honours from CEOs of companies found to be tax avoiding.
        Our  government is also responsible for not only another avoidance scam, the relaxation of the so-called "controlled foreign companies" laws, but also the cutting of thousands of jobs, including those of tax inspectors, at HMRC, where "sweetheart deals", made with companies like Vodaphone and Starbucks, have caused so much public disquiet in this country, let alone in the corridors of power of Europe.They have done next to nothing about tax havens where trillions are squirrelled away; the British Overseas Territories, according to "War on Want", together "rank as the most significant tax haven in the world, ahead of even Switzerland".
        How can we criticise Jean-Claude Juncker for the "tax avoidance schemes that were rife in Luxembourg during his premiership", when we have a government doing similar here?  Can we  really expect there to be an effective agreement on closing international loopholes and ending tax avoidance, involving all the members of the G20 group, when the British government`s hypocrisy is clear for all to see?

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