back to article UK MPs tell Google: Get back here and bring your auditors with you

The UK's Public Accounts Committee has said that it will be hauling Google and its auditor Ernst & Young back in front of MPs to answer further questions about its paltry British tax bills. The PAC said on its website that Matt Brittin, Google veep for sales and ops in Northern and Central Europe and John Dixon, head of tax at …


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  1. Anonymous Coward
    Anonymous Coward

    Take the 5th?

    Opps sorry, wrong country. They'll say nothing on the advice of their lawyers.

    Total waste of time.

    Yes, I can remember the testimony of Oliver North.

    1. Anonymous Coward
      Anonymous Coward

      Re: Take the 5th?

      Parliamentary committees are not courts in any modern sense. Testimony is voluntary. No person (who is not themselves a member of either house) has been found in Contempt of Parliament since 1957. Further, because no oath is taken before the committee, any untruths, half truths etc. do not constitute perjury.

      You could go before a parliamentary committee dressed as a clown and do the bleedin' macarena if you really wanted to - there is no need to "take the 5th" as the commons have no real power to compel testimony*, nor is any testimony provided legally binding. You would, however, have to be absolutely barking mad to appear before a committee as important as the PAC and try to pull a fast one.

      *They do actually have power both to force someone to appear and to compel testimony but since the 1970s the legislative arm of the government has promised (scouts' honour) that it won't use such powers - a gloriously british compromise.

      1. Yet Another Anonymous coward Silver badge

        Re: Take the 5th?

        Or you could just do a Murdoch and not remember anything, or do a Murdoch sons and not know anything or the MP that said he didn't recognise their jurisdiction and refused to answer anything.

        1. Rampant Spaniel

          Re: Take the 5th?

          I'd rather they did a Maxwell.

    2. Steve Davies 3 Silver badge

      Economical with the Truth

      to use the words of a former senior Civil Servant

    3. Anonymous Coward
      Anonymous Coward

      Its all an illusion...

      This is just show-boating IMHO. Government muppets lobby for tax changes that companies like Google want. The other half know intimately how her majesty's revenue works because they get asked about it all the time by lobbyists, especially when drumming up business overseas. Therefore they know all about the daily games companies play with tax law. In short, there was no surprise here. They are just playing the popular card for the plebs. Some officials might be irked by Google steamrolling over their privacy which is compelling them to act. But its all theatrics, and a deal with be struck behind closed doors whilst spinning us some fable about fairness...

  2. Shagbag

    Here we go again...

    ...roll up, roll up, come and see Google in the stocks and the PAC hurl verbal abuse at them.

    What a complete waste of taxpayers' money. The more this goes on, the more the politicians look impotent.


    1. Rampant Spaniel

      Re: Here we go again...

      This is unfortunately just PR. If they were halfway concerned they would change the law, the law they or the previous crooks wrote, the crooks whose election campaigns were funded by donations from wealthy individuals and companies. Oh I think I see the problem...

      It would be interesting to see if they do manage to make them change and pay back taxes (I doubt it will happen). I wonder what google would do? Would we see 'google scotland' appear as two fingers up to westminster?

      1. jonathanb Silver badge

        Re: Here we go again...

        They can't change the law because the place of supply rules are covered by EU law, and parliament has no more right challenge Google's decision to put their sales through Ireland than Basingstoke and Deane Borough Council has to challenge their decision to have their sales support office in Westminster.

        1. John Brown (no body) Silver badge
          Black Helicopters

          Re: Here we go again...

          They can't change the law..."

          The law may not need to be changed if the reports are true. Especially if it turns out that Google UK staff are negotiating sales contracts right up to the point of signing and only that bit is handled in Ireland. That situation would not surprise me in the least. Whether it could be argued to be strictly within the letter of the law would be something for a court to decide.

      2. Anonymous Coward
        Anonymous Coward

        Re: Here we go again...

        they aren't going to change the law when the head of the Public Accounts Committee has family trusts setup so she can dodge taxes herself, surely?

        That's like expecting councils to cut senior exec remuneration before cutting public services?

        1. Anonymous Coward
          Anonymous Coward

          Re: Here we go again...

          @AC 23:49 - I believe the Telegraph who did a story about what you're referring to had to publish a pretty extensive apology as it turns out that she has very small holdings in the family company and no control over it at all.

          (And, yes, I hate to stick up for a Tory, but get them on the stuff they actually do wrong, not what they're perceived to do wrong.)

  3. Anonymous Coward
    Anonymous Coward


    I would have assumed that even though the salesperson is in UK, the company getting the revenue and the income was still Irish. We are talking about income tax here, not sales tax or VAT, right?

    If I buy an iPad at the London Apple store, the person doing the sale is obviously living and working in UK, and the sale is happening in the UK. I always assumed, however, that the company making the money was the Irish subsidiary of Apple (considering they invented the whole Irish double Dutch sandwich thing). Was I wrong? Does Apple UK declare as revenue every sale happening in the UK? Or is there a fundamental difference with Google?

    1. xyz

      Re: Weird

      First off...thanks for the Irish double Dutch tip, I'd never heard of it. Second, Google sells stuff that is more err..."etherial" than Apple, so I presume finding out who sold what to whom and where is a bit more complex than an IPad coming out of Regent Street. Mind you, Apple probably sell iStuff in the UK at almost 0 profit (I'm guessing here) as their Irish supplier's (Apple IE) price for products + the cost of the UK operation are so very, very high (cough) that there is little tax on profits. Once the cash is in the arms of the Irish supplier, then you can double dutch to your heart's content.

      I'm sure there will be a bit of shenanigans regarding the various VAT rates too. Irish 23%, UK 20%, Netherlands 21%. Who said accountants were boring.

      1. jonathanb Silver badge

        Re: Weird

        If you buy in Regent Street, you pay 20% UK VAT, no way round that. If they import from another EU country, there is no VAT payable on the import, and nothing to claim back, so HMRC will get pretty much the whole of the 20% on the sale. Apple will claim back the VAT on their electricity bill, shop maintenance and stuff like that.

        If they import from outside the EU, then they have to pay 20% of the wholesale price as VAT before HMRC will release it from the dock, but they can claim that against the VAT from selling it.

        Rules for online sales are different. Luxembourg has the lowest VAT rate in the EU which I'm sure was not a factor at all in their decision to locate the iTunes Store there.

    2. jonathanb Silver badge

      Re: Weird

      If you buy an iDevice from an Apple shop in the UK, the sale takes place in the UK. Apple UK will buy their stock at wholesale prices from another Apple subsidiary somewhere else in the world. Possibly Apple Ireland might handle distribution for Europe and sell them to Apple UK for not much less than retail price.

      If you buy it on the website, then the website may be located in another country, and that country's Apple division would pay Apple UK a shipping fee to fulfil the order. Certainly their downloadable material, Apps, Music etc is handled by iTunes Luxembourg.

    3. JohnG

      Re: Weird

      "We are talking about income tax here, not sales tax or VAT, right?"

      Corporation tax. The issue is where each transaction takes place i.e. which country and therefore, whose tax system applies.

  4. AndrewCarlton


    "While tax evasion is illegal, tax avoidance is entirely legal" WTF

    UK government should really change that, trying to get out of taxes at all should be illegal, regardless of whether you work for a UK based company or a company using the already mentioned "Irish double Dutch sandwich", if you have operations in the UK you should be liable for all relavent taxes!

    1. Flocke Kroes Silver badge

      Did you buy from before the law changed?

      Not that long ago, companies shipping from the channel islands could avoid some VAT and pass on some saving to customers. Companies that were not set up to ship from the channel island whined that this was unfair, and got the law changed. Before the law changed, many UK customers were avoiding tax by buying from and other tax efficient mail order retailers.

      I am a tax avoider. So is almost everyone else. You are welcome to call the pot black, but have you looked carefully in the mirror? Unless you made a real effort to select opportunities to pay tax, chances are that you are a kettle.

    2. Anonymous Coward
      Anonymous Coward

      Not getting it

      When you declare how much you pay for your medical costs, or when you put money into a retirement pension plan and deduce it from your income, you are also doing "tax avoidance". You are making choices which allow you to pay less tax, even though making different choices would have you pay more taxes. This is what "tax avoidance" means.

    3. Lunatik

      Re: WTF

      When you leave school* perhaps you'll find out that 'trying to get out of taxes' and 'finding the appropriate taxes to pay' are two sides of the same coin. Corporations have an obligation to generate value for their shareholders (not necessarily just maximise profit, as is often quoted) and part of this is achieved by minimising their tax liability.

      If the regulations haven't yet caught up with modern international practices, allowing such 'avoidance', then it's hardly the fault of Amazon, Google or their accountants for exploiting such loopholes, is it?

      Don't get me wrong, I'm no fan of these shell companies in low tax regimes, but pillorying the corporates when it's the Govt/EU's own rules that permit this isn't the best way to effect change.

      * Sorry, cheap dig but I'm down on my ad hominem quota for this year already.

      1. Rampant Spaniel

        Re: WTF

        I think you give them too much credit. I doubt it is a case of 'catching up'. Those loopholes were likely very deliberately created at the behest of the companies who make totally coincidental campaign donations to the aforementioned politicos.

    4. Graham Dawson Silver badge

      Re: WTF

      You know I avoid paying huge amounts of income tax all the time? I don't earn enough to qualify for the top bracket so I avoid paying that tax.

      I also avoid paying VAT on items that I don't buy and I avoid paying inheritance tax by being alive.

      Go read a dictionary. Learn what these words mean before you spout your nonsense again.

    5. Anonymous Coward

      Re: WTF

      The tax laws define which are the "relevant taxes". Avoidance is staying within the letter of the rules. If the rules change, the avoidance patterns change, but avoidance still exists.

  5. Anonymous Coward
    Anonymous Coward

    the trouble with auditors

    Is that they are paid by the company they are auditing, therefore they have to make themselves attractive to the company in order to get the work. Prodding and poking too carefully into the company activities might make themselves less employable.

    In quality management, internal auditing and external assessors are seen as a necessary event that identifies issues and problems that need correction before they cause problems. In finance, proper auditing might turn up more than the old misplaced decimal point and moreof the "shouldn't that value be in that column" and "where does this number come from"

    1. xyz

      Re: the trouble with auditors

      My GF is a finance director of a multinational and apparently it doesn't seem to work like that with auditors(i.e.1+2=3). The bigger the numbers get, the more "fluid" and "open to interpretation" they become. At the end of the day it seems like everyone has an idea of a figure and everyone eventually agrees a "feels about right" number. It's quite baffling to watch.

      1. Neil Barnes Silver badge

        Re: the trouble with auditors

        What's 2+2?

        Engineer: 4.00, to appropriate clearances.

        Mathematician: 4, assuming a rational number line and a base higher than 4.

        Auditor: Locks door, closes curtains, sweeps room for bugs and then whispers 'what do you want it to be?'

        1. jonathanb Silver badge

          Re: the trouble with auditors

          Auditor's answer, it depends. Seriously, 2 + 2 doesn't always = 4. Usually it is a number between 0 and 4. Sometimes it can be more than 4. It depends what you are counting. There are many good reason why it could come to something different, but more importantly you should be looking at whether or not it is appropriate to add those two numbers together.

      2. shameek

        Re: the trouble with auditors

        Yes the numbers are based on materiality. They don't examine every single item, they make sure the numbers roughly add up. Ask Ms Hodge about her own company who also don't pay there full whack in tax. Pot kettle.

    2. Jeff LeCoat
      Thumb Down

      Re: the trouble with auditors

      "Is that they are paid by the company they are auditing, therefore they have to make themselves attractive to the company in order to get the work."

      Incorrect. External auditors are appointed by the sharesholders to scruitinse the directors on their behalf. There is regulation around rotation of auditors and audit partners to prevent familiarity and what you highlight above. Your point is still valid as obviously the shareholders want to minimise tax and maximise dividends; but not illegally like a director would/could. HMRC/UK Gov will be using the report from E&Y to the shareholdersas a basis for tax calculation validation, but this is not the purpose of the report - it's just something easy for them to use. E&Y will be making this point repeatedly when appearing in front of the PAC.

  6. QuinnDexter

    "You, Google, YOU came and based businesses in the UK and Europe and took advantage of our tax laws, which we wrote, designed to benefit large multi-national corporations, meaning that you pay next to no tax in the UK, and very little else in the rest of the Eurpoe."

    "Correct. Is that everything?"

    " yes, that's all"

    Why are the relatively new global companies the only ones being investigated? Shirley BP and companies of that ilk are doing the same kinda thing, and if not they need to slap their accountants? Why would anyone pay more tax than they have to? If it's currently such a terrible tax solution then perhaps the PAC should move to change the laws rather than attempt to embarrass companies into paying more when they don't have to.

    Maybe there should be an icon of Kent Brockman to choose from, seeing as the words "tax avoision" are becoming part of the English language - I even heard it on the Beeb, so it must be proper English

    1. Anonymous Coward
      Anonymous Coward


      British companies do use the same type of laws. I know of one company have "consultants" in the UK who never actually buy or sell anything. Instead, they send the whole thing to a tiny offshore company who send out the actual contracts. That way, all the actual trade is in off-shore tax haven and Hey, the UK office is actually loosing money. So they ask for and get a tax rebate.

      Another one does the same sort of thing. They buy stuff and immediately sell it at cost to their off-shore office. Then the sell stuff, and to fulfil the sale, they buy from the off-shore company at the same price. Hence their sales force is in the UK, but the profits are made in the off-shore company. Hence no tax.

      (Edited for obfuscation and post AC to protect the guilty, and my job!)

  7. batfastad


    Why do Google's accountants have anything to explain? A private company and as such it's in their interest to pay as little tax as is allowable by law. Just as it's in my interest to pay the legal minimum amount of tax. Just as it's in the interests of every single MP on the committee to pay just the legal minimum. I doubt any of them have voluntarily paid more tax than they have to.

    Oh dear... a rant is brewing!

    And calling it morally repugnant? Please. Since when is it the job of politicians to cast moral judgements? The fact that any politician can believe they are morally superior to anyone or anything is exasperating, by definition that is impossible.

    It's morally repugnant to constantly whinge about companies that haven't apparently broken any rules, when they continually fail to change the rules that they themselves are responsible for. It should be MPs in front of a committee.

    1. Anonymous Coward
      Anonymous Coward

      Re: Why?

      "A private company and as such it's in their interest to pay as little tax as is allowable by law"

      I think if you look on NASDAQ you may find Google isn't a private concern.....

      There's nothing wrong in reducing your tax overheads.

      However there are rules against creating synthetic/artificial constructs to avoid paying tax.

      The problem is that (especially HMRC in the UK) don't enforce their own rules and prefer to participate in shady lunchtime meetings to broker gentleman's agreement deals to decide what minimal amount of tax large multinational companies pay.

      That is at least against HMRC guidelines/rules and probably also illegal.

      Also, as being pointed out by the "How Corrupt is Britain?" conference, it's indicative of the corruption that seems to be systemic in British life today.

      1. Jeff LeCoat

        Re: Why?

        The reality isn't quite like this. In HMRC's defence they're operating in a world where the investigation of these issues takes a large amount of money and time, and often cutting a deal is the best answer for everyone. 5 years of investigation and then a court case cost millions. Yes it is true that the cost of investigation should not be a deterrent but when the "grey area" for these cases is so large it doesn't tend to benefit either party. Also they want to be seen as pragmatic and not bureaucratic in the eyes of international business. They also have to operate within the global matrix where our 'allies' like The Netherlands and Ireland creating laws and systems to undermine the British system of corporation tax.

        Of course it can be done better but they're a government department and the government sometimes do everything they can to make life difficult.

        1. Anonymous Coward
          Anonymous Coward

          Re: Why?

          "The reality isn't quite like this. In HMRC's defence they're operating in a world where the investigation of these issues takes a large amount of money and time, and often cutting a deal is the best answer for everyone. 5 years of investigation and then a court case cost millions."

          Yet five years of investigations into a suspected IR35 case for a possible £30k, or a window cleaner who may owe £10k in taxes, is perfectly justified.

          Shame on the HMRC.

    2. CaptainHook

      Re: Why?

      Why do Google's accountants have anything to explain?


      The whole point of the original hearings was to work out how such huge companies with very large turnover were paying so little tax, it wasn't trying to establish whether the companies were acting illegally but to work out which loopholes were being exploited in an attempt to close those holes at a later date through changes to the law.

      Google said they keep all their sales staff in Ireland specifically to take advantage of the lower Corporation Tax in that country (completely legal) and that the UK staff weren't sales staff, if they are just support staff they don't generate any turnover and are only a cost center and hence generate no profit to be taxed.

      When the PAC asked the accountants whether they checked Googles offices to make sure what Google said about it's staff was true they said (and I'm paraphrasing alot) "Yes, Google sales are all based in Ireland, take our word for it".

      Google and Ernst & Young have been summoned back because of a report by a US newspaper has evidence that Google's London Office is teeming with sales staff. Both Google and Ernst & Young are not being called back because of their tax arrangements but because everything they said to the PAC first time around now smells a little bit fishy.

  8. The BigYin

    E&Y you say

    One of the largest advisors to the government on tax issues, you mean.

    All the big accountants control government tax policy, it's in their interest to do so in order to allow them to sell "solutions" to their clients.

    Does PAC no realise they are interviewing the very people who wrote the law?

    If the government doesn't want tax loop-holes, stop asking the people who profit from tax loop-holes to write the friggin' law!

    And IF Google has evaded tax, why is the PAC running the shown and not HRMC?

    You know, HMRC. The people who sold their buildings to a company in a tax haven.

  9. John G Imrie Silver badge

    why is the PAC running the shown and not HRMC?

    Because the HMRC are a bunch of lying incompetents who'd sell out the UK's tax laws for a good lunch.

    1. Anonymous Coward
      Anonymous Coward

      Re: why is the PAC running the shown and not HRMC?

      Rather more germane is why is it the PAC and not the Treasury Committee. That after all has a chair elected by their peers to run a committee to look at the expenditure, administration and policy of HM Treasury, HM Revenue & Customs, and associated public bodies, including the Bank of England and the Financial Conduct Authority. PAC is there to see if the departmental and other accounts are in order and is specifically not to look at the formulation or merits of policy.

      Tax avoidance is more than legal - it is endorsed and accepted as a fundamental part of tax policy including 'nudge' policies such as taxes on alcohol, smoking, waste, energy, fuel and carbon.

      This is rather more a failure of tax simplification policies than anything else and the assumption that employees are rather less mobile than companies. Tax simplification is rather suspect at the moment as its hard to believe it will be a revenue neutral process until the deficit is eliminated and most have stopped talking about it all together as arguing for a tax break or subsidy is easier.

      I for one don't expect companies to make moral decisions - the only outcome of that is the less ethical companies get an unfair advantage.

      I'm not terribly keen on the concept of a moral amount of tax - although some libertarians would say zero or voluntary - and putting most 'moral' decisions into law has a poor track record and tends to benefit organised crime disproportionately and they are MUCH harder to tax.

      So go with competitive, effective and value for money and companies will be queuing up to pay here instead of elsewhere. And the value for money bit is the job of the PAC!

      So that means in all this its the PAC that isn't doing a very good job ....

  10. Anonymous Coward
    Anonymous Coward

    E&Y failed to do my us tax return properly

    I ended up paying double tax while i was in the us cos of e&y incompetence. maybe they will find that they screwed up Googles tax return too and they are actually due a tax rebate.

    1. Anonymous Coward
      Anonymous Coward

      Re: E&Y failed to do my us tax return properly

      Wonder if that explains the big post on their intranet yesterday about how to calculate US tax liabilities

      1. This post has been deleted by its author

  11. Anonymous Coward
    Anonymous Coward


    Should try to make taxation within the EU more "similar". In a way Ireland (and similar) are the problem here.

    1. John Brown (no body) Silver badge
      Thumb Down

      Re: EU

      What? You mean let the unelected EU set tax rates across the EU? Do you want the United States of Europe to be created so quickly? Tony Blair did state many years ago that his ambition was to the first President of a fully united europe. Can't we at least wait until he's dead and gone?

  12. Anonymous Coward
    Anonymous Coward

    If they are turning a blind eye to the big players then leave the little guy alone too. Why penalise the small player that goes out to work in all weathers to generate money that then goes straight back into the economy? Madness.

  13. JaitcH

    'committee has not found any legal wrongdoing ... behaviour has been "immoral".

    If they are looking at morals MPs, given their recent history of expense abuse, are hardly the best equipped, or most suitable, to discern a moral.

    And, talking of scruples, when are the likes of money lauderers like HSBC going to have a day of reckoning, or are they too big to question?

    1. Anonymous Coward
      Anonymous Coward

      global systemically important banks/systemically important financial institutions

      Re HSBC money laundering:

      HSBC may or may not be too big to question, but they are on a global list of financial institutions considered too big to fail - the "global systemically important financial institutions" (or global systemically important banks) list, which you can read about elsewhere.

      So what's the point in questioning these institutions, unless there is some other motive.

      In HSBC's case the money laundering questions have largely been asked and answered, and a very minor slap on the wrist has resulted. Money laundering (especially in the Americas) is, after all, meant to be the responsibility of the CIA and friends.

  14. Fink-Nottle

    Another example ...

    I live in the UK.

    I offer to sell a second hand book on

    A buyer purchases the book in the UK.

    The profit I make from the sale is taxed in the UK.

    However, the sale is mediated by by Amazon Services Europe, which is established in Luxembourg. Thus their fee is payable outside the UK, and the profit they make from the sale is not taxed in the UK.

    Although this is legal, it just doesn't seem fair.

  15. Anonymous Coward
    Anonymous Coward



    <<The following post may contain views that are controversial, unpopular, thought-provoking or even sensible. May also contain trace amounts of nuts. Read with care.>>

    I wonder when our so-called "wealthy" economies will quit punishing the organizations that can actually generate wealth, invest in local economies and pay working people's salaries.

    Governments which feel they can't extract sufficient revenue out of a deflating economy should first ask hard questions like:

    - Is it because no one wants to invest here?

    - Are companies investing elsewhere and avoiding taxes because the corporate tax rate is too high?

    - Are taxes too high because the tax money is being wasted through incompetence and fraud?

    - How much of our state's GDP is composed of non-revenue, non-wealth generating activities such as public services and administrations and how much is being generated by wealth-generating private industry, investment and initative? <<Free points for guessing which of the above has the double benefit of simultaneously generating more income for citizens and more revenue for the state. >>

    This does not imply that states should simply stop offering public services. It does imply that states should first ensure that these public services are needed, can be run efficiently and correctly financed before offering them. You know, the way well-run companies and households must do. You don't buy your kids a 1000 £ toy for Christmas or give top executives massive bonuses (unless you run a fiat-propped bank that is too big to fail) if you can't pay the rent. Nope, you make sacrifices and count your pennies.

    Unfortunately, since public services generate little to no revenue on their own (or lose massive amounts of revenue), the money must come from somewhere. That is the conundrum of the welfare state. The question that inevitably follows is: who pays for it?

    I believe Western Governments should start thinking about how to tax LESS instead of more. This could be done by slowing down and cutting back on the war machine, borrowing less, reducing waste, fraud and inefficiency, building up industries and infrastructure, and spending money on things that people actually NEED like job-creation, education, proper health care, and common-law crime-prevention.

    Safer streets (and banks) with healthier, well-trained individuals doing productive, decently paid activity are what is needed to tackle 21st century challenges. We do not need more tax dodging, over-funded government band-aids which will move an increasingly larger proportion of the populace towards the breadline.

    Personally, I believe the only honest (or moral if you wish) form of taxation is consumption taxation (like VAT) because it is:

    Easier to collect and more difficult to evade

    Inherently fairer, i.e., the Bentley buyer should and will pay more tax than a housewife buying her toddler's clothes and baby food (which should normally be taxed at 0% anyway).

    If "wealthy" Western countries abolished income tax and reduced corporate tax to the bare minumum, corporations would break down the doors to set up shop here. The people they hired in these countries could spend their non-taxed income on consumption (or else save and/or invest it). Such spending would further inject real (as opposed to imaginary) money into the local economy and further increase the rate of consumption (thereby increasing consumption tax revenue).

    Compare that model with what we have today.

    - High taxation (VAT, corporate, income) rates in nearly all developed countries.

    In my humble opinion, anything above 10 % is already too high.

    - Companies playing expensive, counter-productive and complex shell games to avoid paying high(er) taxes

    - High unemployment and low growth in these high tax countries

    - A steadily diminishing standard of living for the general public in high tax countries (with some notable, but increasingly rare exceptions)

    - Massive deficits run up by high tax. under-financed, debt-ridden governments.

    - Massive printing of money to virtually paper over the increasingly wider cracks in a crumbling edifice.

    - Manufacturing companies fleeing to low-wage, low-tax countries and taking everyone's jobs with them.

    - Corporate, banking and government fraud and scandal on a previously unimaginable scale (witness Enron, sub-prime mortgage scams, AIG, Greek bailouts, and the war on terror).

    Elected officials must get a grip and start making common sense decisions based on sound economics and science, instead of wishful thinking, PR value, lobbying and voodoo. As citizens we should help them by protesting against and flunking out officials who can't do the basic math.

    Sadly, the dole-seeker who can't find a decent job anymore and the hard stretched middle and lower classes seem to be the only ones forced to make common-sense decisions, these days.

    Meanwhile, the individuals and institutions that benefit from this rotting system just keep on minting it while pretending to do something useful (like calling successful companies to the carpet, ramping up nanny-state controls and police surveillance or scanning people's bodies with radioactive devices whenever they travel).

    Trust me, it will all end in even more tears-

    In difficult economic times (when people must spend less) the government must also tighten its belt, instead of printing more money to "stimulate" the economy.

    During the Age of Reason, Francis Bacon wrote "Above all things good policy is to be used so that the treasures and monies in a state be not gathered into a few hands... Money is like muck, not good except it be spread."[9

    Bring back the Age of Reason, please. Higher taxes do not stimulate growth nor do they re-distribute income fairly. If they did, 80 % of the world's wealth would not still be owned by 10% of the population.


    1. Cucumber C Face
      Thumb Up

      Re: STOP THE ROT

      Pity you posted anonymously - I want to have your babies

    2. Anonymous Coward
      Anonymous Coward

      Re: STOP THE ROT

      So close, and yet so far, hence downvote. Sorry. Lots of good observations, good aims, but in the end the recommended method doesn't work, except in the short term in very special circumstances of weird local economic practices - Luxembourg, Netherlands, Cayman Islands?

      And now even the Tories are talking about reducing global tax dodging. Wtf?

      "If "wealthy" Western countries abolished income tax and reduced corporate tax to the bare minumum, corporations would break down the doors to set up shop here"

      Look at Ireland. See how well the "low tax, light touch regulation" model worked for them. Corporations did indeed set up subsidiaries there, and indeed some had done so even before the New Era started. Now, in 2013, what remains of the Irish tiger economy? Not much.

      There may well be global companies allegedly active in Ireland, but in many cases the majority of their business (and thus the major of the benefits) will be elsewhere. The classic example of this would be the Irish subsidiaries of German banks. The routine work is still done in Germany, nothing much happens in Ireland in terms of benefits for the local economy, but when a particular transaction needs to be done under Irish law for tax or regulatory reasons, over to Dublin they come, do the necessary, and then they fly back again. May well be the same kind of game as parts of Google are playing, though I believe Google do (did?) actually have a couple of thousand people in Dublin. Which is nice.

      6/10. Could do much better.

      1. Anonymous Coward
        Anonymous Coward

        Re: STOP THE ROT

        To be fair, much of what blew up the Tiger economy in Ireland was circumstantial and self-inflicted.

        As the Republic's economy happily ballooned to 5 % growth p/a, misguided politicians soon felt the urge to sabotage it. After realizing that 30 % of Irish economic output was being generated by the building industry, some dim sparks decided that ownership of a second residence as a tax free option (i.e, creation of a tax dodge, for lack of a better term) would be a great idea. Chairman Mao would have heartily approved.

        Result? An overheated housing market, over 300, 000 phantom (now rotting) almost-finished residences, failing banks and a per capita debt of 400 K € for each and every citizen of the Republic. Left on their own, I think most of those first time home owners would have worked hard to steadily pay off that first mortgage and remain solvent in the process. Shame it didn't work out that way. But then, Money is an excellent servant and a very bad master.

        I would not blame Adam Smith for this sorry state of affairs, I would prefer to blame the misguided and brain-dead (if not outright corrupt) intervention of politicians in what was otherwise a Euro success story. The decision to move operations to tax havens is based on many case studies showing how easily elected governments can f*k up a market economy.

        And although I have never met you C C face, I too, believe we could have beautiful babies, xxxxx

  16. All names Taken
    Paris Hilton

    Dear google (hope this helps)

    Dear google

    There is nothing logical or sensible about UK tax laws. In fact, they are made far too complicated for the multitude to understand and that lets an elitist few (usually UK civil servants)?) in to make a lot of extra dish after they -ahem- "retire" from the firm.

    For example: a holding company.

    The principle is that all assets are owned by a holding company and all at risk ventures become companies owned by the holding company.

    It sounds fine in theory but what happens in practice means that employees of one company are switched to another and yet no formal paperwork exists to say it is so.

    UK HMRC knows it is so, lives with the illogical and the inconsistensies and cannot in any measure of the term be considered to act in "altruistic" fashion.

  17. Anonymous Coward
    Anonymous Coward

    All companies should avoid tax... didn't do Greece any harm!

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