Corporations avoid tax in the UK - and they avoid punishment

[Sketcz]

I'm sure everyone has been seeing and reading news of how big corporations avoid tax in the UK:

http://www.guardian.co.uk/business/2012/dec/03/amazon-google-starbucks-tax-avoidance

This disgusts me. I've seen some interviews on TV, where the news reader has asked basically: "Why don't you clamp down hard on these companies and MAKE them pay tax?"

And the replies from MPs and financial experts are always the same: "We want to be fair to them, we don't want to tax too hard in case they decide to leave the UK."


This situation is ****ed beyond all logical comprehension. Just ****ing take the money from them, otherwise throw them out! Is Starbucks really going to choose between paying tax or not having a single shop on any British highstreet? This doesn't require any kind of deep thinking, or even a financial background. Just make them pay, or they can GTFO.

There are no eloquent or intellectual words which can justify this bull**** - though I'm sure someone with a financial degree will try to justify it (pitchforks and lynching rope for the first person who tries).

If any one of us on this forum avoided even a small amount of tax, we'd be thrown in jail immediately. But if a big corporation avoids millions or billions in tax, that's just fine and dandy, because we don't want to upset them, do we?

It seems tax laws exist solely for poor individuals, and no one else. How much tax can one lowly prole even avoid? A drop in a galactic ocean compared to Starbucks, Google and Amazon. Yet it's the proles that carry the yoke of the law, while the companies behave as if they're a law unto themselves.

If aliens ever visited our planet they'd think our entire species is comprised of imbeciles.

[vanpeebles]

Same old crap in this pathetic country.

[charlesr]

"On Saturday night, Starbucks announced that it is reviewing its tax approach to Britain with a view to paying more following widespread criticism of the coffee chain's tax regime."

Surely they should be reviewing their approach with a view to paying the right amount? And if they haven't being paying enough then they should be coughing up the difference!

It's like they are agreeing they dodged tax and will try not to dodge quite as much in future.

[EJG1980]

And the replies from MPs and financial experts are always the same: "We want to be fair to them, we don't want to tax too hard in case they decide to leave the UK."

This situation is ****ed beyond all logical comprehension. Just ****ing take the money from them, otherwise throw them out! Is Starbucks really going to choose between paying tax or not having a single shop on any British highstreet?

Quite right, I hate the "Ohhh, but they'll take their business somewhere else!" argument, it just doesn't stand up.

If a company was making ?10 billion in profit and dodging tax, and you clamp down on them so they pay the right amount of tax and it reduces their profits to ?5 billion... are they really going to say that they don't want that ?5 billion, that if they can't make ?10 billion they'd rather make nothing and will stop doing business here? Of course not.

[endo]

Absolutely. And if the authorities did say to Starbucks, 'pay up or piss off' and they went, so what? All of a sudden there'd be no coffee shops? Some of the gaps would be filled with UK-run coffeeshops which would no doubt do quite nicely. As it is, homegrown coffee places here lose out massively to the international corporate giants. To add insult to injury, homegrown coffee businesses have to pay loads more tax because they're small, based here and simply aren't in a position to employ the sophisticated swindles the multinationals do. Totally unfair really.

[Nijo]

There's another angle to this: if Amazon, Starbucks, etc pay no corporate tax, they can afford to reduce their prices to a level that local tax-paying business can't compete with. So while there may be some argument in 'trying not to make them leave', in doing so you're hurting actual UK business.

Didn't play.com use the same trick by being Jersey based?

[smouty]

Although I don't agree with companies not paying tax, the downside is only going to affect British taxpayers e.g Company pays more tax, company limits expansion, company employs less people, more unemployed, more benefits paid out and associated issues.

[EvilBoris]

"On Saturday night, Starbucks announced that it is reviewing its tax approach to Britain with a view to paying more following widespread criticism of the coffee chain's tax regime."

Surely they should be reviewing their approach with a view to paying the right amount? And if they haven't being paying enough then they should be coughing up the difference!

It's like they are agreeing they dodged tax and will try not to dodge quite as much in future.

It's the sneaky way in which it is done that is the problem, the UK arm of Starbucks is essentially a Franchise of the US version, they have to pay the US version a fee for being Starbucks and a percentage of their profit.

The sneaky thing here is that the fee they are charged is so deliberately high that they run the UK arm at an apparent loss, which means they don't appear to be as rich and successfull as they actually are, therefore avoiding certain taxes.

[EvilBoris]

Absolutely. And if the authorities did say to Starbucks, 'pay up or piss off' and they went, so what? All of a sudden there'd be no coffee shops? Some of the gaps would be filled with UK-run coffeeshops which would no doubt do quite nicely. As it is, homegrown coffee places here lose out massively to the international corporate giants. To add insult to injury, homegrown coffee businesses have to pay loads more tax because they're small, based here and simply aren't in a position to employ the sophisticated swindles the multinationals do. Totally unfair really.

Costa is a UK based company part of the whitbread group which is a Uk based company, they are actually bigger chain here.

[bash]

Lets be honest though, the MP's in who could speak up are probably getting their pockets lined with cash to keep quiet anyway.

[smouty]

I think this is the issue ^^
The companies involved were not breaking the law but were using elaborate schemes to avoid tax. The government need to take responsibility for not closing the loopholes.

[EvilBoris]

It's a bit like putting penalty points on someone else's driving license.

Only that someone else doesn't hold a UK license, therefore everyone gets off scott free.

[charlesr]

Cheers for the explanation dude. Very clear.

[EvilBoris]

I can't see how they let it happen, they let Vodaphone and Topman off their millions of owed taxes, right in the middle of a recessions.
I've got a weird recollection that the money that Vodaphone owed was more than the entire deficit for the countries finances or something as almost as obscene.
Making them pay would of meant that they wouldn't have to be making all those budgetary cuts to the NHS and the Police etc.

[endo]

Yeah, for Vodaphone it was in the billions, not millions.