The Paradise Papers

[ckn]

21 minutes ago, Griff9of13 said:

What did Sefton Council do with the £1.6 million in stamp duty it saved? Was it used to enrich the lives of individual councillors or was it used to go some way to plugging the massive hole in the council's finances; it would go a long way towards social care for example?

It's something I've never understood, why do state establishments still have to pay taxes at all?  The NHS pays VAT, and often can't reclaim it, same with business rates.  Big companies can use intra-group trading to essentially avoid, perfectly legally, all manner of taxes and duties, yet the same loopholes have been barred shut for the public sector who have to pay the same taxes and duties.

[ckn]

2 hours ago, Robin Evans said:

The paradise papers indicate proven transactions.

I' assumingthe cabbie I tipped a couple of quid for bringing me back from wath after too much whisky, pays his dues.

If he doesn't the suggestion that it is the same as some of those indicated above is whilst both repugnant, nonsense..... morally or legally.

I would suggest hmrc and the statute books agree but im no expert on such matters so will stand advised.

I'm one advocating and increase in income tax!

If a cabbie doesn't declare the tip you give him then that's one person.  If a multi-millionaire deliberately evades taxation then that's them, their accountants, their bankers, their lawyers and so on, all with professional ethical standards that they're deliberately and wilfully breaching.  And if they do it for one, they'll be doing it for many more.

So, the first example is one person skimming a relatively trivial amount, the second example is likely hundreds of people involved in the systematic defrauding of the Exchequer.

[Robin Evans]

42 minutes ago, ckn said:

If a cabbie doesn't declare the tip you give him then that's one person.  If a multi-millionaire deliberately evades taxation then that's them, their accountants, their bankers, their lawyers and so on, all with professional ethical standards that they're deliberately and wilfully breaching.  And if they do it for one, they'll be doing it for many more.

So, the first example is one person skimming a relatively trivial amount, the second example is likely hundreds of people involved in the systematic defrauding of the Exchequer.

I think that was the point I was struggling to make due to time issues ?

[Tongs ya bas]

1 hour ago, ckn said:

If a cabbie doesn't declare the tip you give him then that's one person.  If a multi-millionaire deliberately evades taxation then that's them, their accountants, their bankers, their lawyers and so on, all with professional ethical standards that they're deliberately and wilfully breaching.  And if they do it for one, they'll be doing it for many more.

So, the first example is one person skimming a relatively trivial amount, the second example is likely hundreds of people involved in the systematic defrauding of the Exchequer.

And they are both as bad

[John Drake]

16 hours ago, gingerjon said:

Then you've fallen for the legal/illegal discussion which is tedious but allows for useful idiots to parp up about how no laws have been broken.

Aside from the ones - such as leasing back property to yourself - that have, of course.

But no matter.

Far more interesting is the network of inter-related politicians, businessmen and their fellow travellers who are investing in each other, in complete and total secrecy, and then directly influencing policy around the world as a result.

Maybe you don't care that the Queen is a craven tax dodger. However, her son appears to have invested, in secret, in a renewable energy firm and then lobbied for that industry to receive favourable treatment. Benign compared to some of the things in there - Lord Ashcroft revealed again to lie about his actions assuming no-one would ever find out for example - but, still underhand.

I haven't fallen for anything. 

I'm not defending these practices at all.

I'd like to see everyone paying their fair whack in tax, but I can do without the lectures on morality and all the holier than thou pontificating that often goes with it.

That doesn't achieve anything. 

Changing the tax laws and giving HMRC the resources to enforce them just might, though.

[shaun mc]

And not to condone it but.....

A million people avoiding £10 tax are far more likely top spend it items which means the Treasury gets some back - VAT, fags, fuel, booze and the non-tax portion supporting UK businesses

The 10 who avoid £1m - more likely to spend outside of UK, invest offshore and the Treasury sees very little perhaps. 

[Tongs ya bas]

1 hour ago, John Drake said:

I haven't fallen for anything. 

I'm not defending these practices at all.

I'd like to see everyone paying their fair whack in tax, but I can do without the lectures on morality and all the holier than thou pontificating that often goes with it.

That doesn't achieve anything. 

Changing the tax laws and giving HMRC the resources to enforce them just might, though.

 Behave

Nobody has lectured anybody

What people have done is given their view on an important topic that affects us all.

As far as I am aware, the trl forum does not have the power to change government policy, but it does exist to give people the opportunity to share their views on a wide variety of topics. It's informative and often good fun. 

I think most people are aware of the relevance of tax laws in connexion with this subject.

What word would you suggest instead of immoral, that doesn't offend your sensibilities?

[ckn]

Largest ever fine for a law firm failing to properly monitor the things that it does.

It's little things like this that make the think there is still some hope for properly regulating this sort of thing.  The more big firms that shy away from it, the better.

[gingerjon]

2 hours ago, John Drake said:

 

I'm not defending these practices at all.

 

Good, because they're illegal.

[ckn]

8 minutes ago, gingerjon said:

Good, because they're illegal.

Actually, they're usually not.  Most often they sit within designed loopholes that have originated from well-lobbied "assistance" to MPs, see my comments above about the Isle of Man for examples.  I once read that the UK's taxation laws, regulations and guidance would fit inside a small folder but for all the loopholes.

[gingerjon]

1 minute ago, ckn said:

Actually, they're usually not. 

Don't actually me, young man.

They're only legal, a lot of the time, if you use them for their intended dubious purpose.

To go back to Lewis Hamilton's jet.

Just writing on a piece of paper that he's actually now a Manx business leasing back his jet to himself for business purposes doesn't make that true.

Loans are only loans if they are to be repaid under normal business terms (another common practice picked up in these papers).

Obviously, you need good and well-resourced people to follow this up but a lot of the time the laws don't need changing. They just need following - and for the UK to follow the US standard on this: if you lied, you're done. Our prosecutions are invariably technical which is why they often fail.

[ckn]

Just now, gingerjon said:

Don't actually me, young man.

They're only legal, a lot of the time, if you use them for their intended dubious purpose.

To go back to Lewis Hamilton's jet.

Just writing on a piece of paper that he's actually now a Manx business leasing back his jet to himself for business purposes doesn't make that true.

Loans are only loans if they are to be repaid under normal business terms (another common practice picked up in these papers).

Obviously, you need good and well-resourced people to follow this up but a lot of the time the laws don't need changing. They just need following - and for the UK to follow the US standard on this: if you lied, you're done. Our prosecutions are invariably technical which is why they often fail.

Companies are separate legal personalities and the courts are strict on that interpretation except where there's fraud involved.  That's where the IoM comes in (again, other tax havens are available), as IoM is treated as a separate legal jurisdiction then its laws trump ours if a company is established there and pays tax there.  If IoM treats jet purchases as zero-VAT liable then Lewis is perfectly within his legal right to get his company in IoM to buy it and then give it to him for 1p per month if he sees fit, as long as he obeys IoM laws.  It's all to do with double taxation, you should not pay tax on the same money in two different countries, therefore IoM's 0% VAT trumps the UK's 20% VAT.

That's also why it's so hard to clamp down on it for international companies and people.  A respectable country can only lay claim to tax on residence and domiciled basis meaning you've got to have earned the money here.  Lewis can reasonably claim that all bar one of his races a year is abroad therefore the UK has no say on anything but that money, even then, if his contract is in a tax haven then he can get away with nothing other than token UK taxes.  Same as how a company does it, they have their "HQ" in a tax haven and all national companies as nothing other than cost centres rather than profit centres with all profits being shipped abroad to be taxed at tax haven levels of taxation.

Seriously, it's 100% legal.  About as unethical as it gets but, still, it's legal.  That's how international tax havens stay within the law.  Just.

It's also why it can't easily be clamped down on, if we say that those tax havens are evasion centres rather than avoidance centres, where do we stop?  What about Singapore?  What about Ireland dropping its business costs to attract business?  It's a seriously complex subject that's not easy to solve.

[John Drake]

55 minutes ago, gingerjon said:

Good, because they're illegal.

Except for all the ones that aren't, but probably should be.

[John Drake]

32 minutes ago, ckn said:

It's a seriously complex subject that's not easy to solve.

The most sensible comment made in this thread so far, IMO.

[John Drake]

1 hour ago, Tongs ya bas said:

 Behave

Nobody has lectured anybody

What people have done is given their view on an important topic that affects us all.

As far as I am aware, the trl forum does not have the power to change government policy, but it does exist to give people the opportunity to share their views on a wide variety of topics. It's informative and often good fun. 

I think most people are aware of the relevance of tax laws in connexion with this subject.

What word would you suggest instead of immoral, that doesn't offend your sensibilities?

People are free to express their views.

And I'm free to disagree with them or find them annoying and patronising.

That's life on TRL.

[Tongs ya bas]

1 hour ago, John Drake said:

People are free to express their views.

And I'm free to disagree with them or find them annoying and patronising.

That's life on TRL.

It is

So what areas of the contributions to this thread do you disagree with?

You don't like morality being invoked. Does this mean you think this behaviour is moral? 

I can't apologise enough if I have annoyed you. But frankly I believe that it's you who is being patronising.

http://www.independent.co.uk/news/uk/politics/blairs-company-paid-just-315000-tax-on-income-of-more-than-12m-6287001.html

I dont suppose this colours your perspective on the subject?

 

or this

 

https://www.theguardian.com/politics/2009/dec/01/mystery-tony-blair-finances

[gingerjon]

2 hours ago, ckn said:

Companies are separate legal personalities and the courts are strict on that interpretation except where there's fraud involved. 

Which, if you're pretending to be a company, there is.  Which, if you're claiming it's a business lease, there is.  Which, if you're claiming it's a business loan, there is.

And if you move your money to the Isle of Man, or anywhere, and then set one of these things up based on that fraud, and coincidentally your UK tax drops despite your residence/activities/business etc being in the UK, that's not avoidance, that's evasion.

Which is naughty.

[ckn]

6 minutes ago, gingerjon said:

Which, if you're pretending to be a company, there is.  Which, if you're claiming it's a business lease, there is.  Which, if you're claiming it's a business loan, there is.

And if you move your money to the Isle of Man, or anywhere, and then set one of these things up based on that fraud, and coincidentally your UK tax drops despite your residence/activities/business etc being in the UK, that's not avoidance, that's evasion.

Which is naughty.

I get what you're saying but you can set up a company tomorrow to cover all manner of personal expenses.  Virtually every actor, retired politician and other person relying on their own actions will work through a personal service company for tax-efficiency and other protections.

Perfectly legally, I can go contracting tomorrow as a one-man company, pay myself minimum wages and use the rest for all manner of expenses from within the company.  About the only thing I couldn't do tax-efficiently these days is run a buy-to-let business.

If Lewis's F1 contract is based in, say, Monaco then his worldwide taxation is there regardless of how upset HMRC get over it.  If he has a subsidiary "Lewis's aircraft rentals" based in the IoM then he can run that at 100% loss as long as it meets the IoM's tax laws, and there's nothing illegal about it.  It isn't illegal to run a business at a loss, feed it with your own money and then claim it as business losses in your tax returns, the most HMRC can do is grumble that you're not trying to make a profit and ask that you do something, but only if you're a UK based company.  In fact, if Lewis's money never touches a UK bank on a non-UK contract then HMRC has no business even getting sniffy about it unless he meets the residency tests for global taxation.

All of that is legally and ethically correct, it may be morally incorrect but that's a different matter altogether.

[gingerjon]

Just now, ckn said:

I get what you're saying but you can set up a company tomorrow to cover all manner of personal expenses.  Virtually every actor, retired politician and other person relying on their own actions will work through a personal service company for tax-efficiency and other protections.

Perfectly legally, I can go contracting tomorrow as a one-man company, pay myself minimum wages and use the rest for all manner of expenses from within the company.  About the only thing I couldn't do tax-efficiently these days is run a buy-to-let business.

If Lewis's F1 contract is based in, say, Monaco then his worldwide taxation is there regardless of how upset HMRC get over it.  If he has a subsidiary "Lewis's aircraft rentals" based in the IoM then he can run that at 100% loss as long as it meets the IoM's tax laws, and there's nothing illegal about it.  It isn't illegal to run a business at a loss, feed it with your own money and then claim it as business losses in your tax returns, the most HMRC can do is grumble that you're not trying to make a profit and ask that you do something, but only if you're a UK based company.  In fact, if Lewis's money never touches a UK bank on a non-UK contract then HMRC has no business even getting sniffy about it unless he meets the residency tests for global taxation.

All of that is legally and ethically correct, it may be morally incorrect but that's a different matter altogether.

My understanding is that there's enough UK-ness in the process to mean that HMRC do have at least cause to investigate.  The likelihood of them winning is slight though because, as I say, UK law tends to do it all on technicalities (hence why, as far as I'm aware, we still have prosecuted anyone about Madoff) unlike the US where they just prove you're a lying get and have done with it.

But, as I said a while back, ultimately the legal/illegal stuff is just the crumbs being fed for useful idiots to get worked up about. The real stuff, the fun, juicy stuff, is the light thrown on all manner of shady connections which have either been lied about by omission or just plain hidden away in the hope that no one would ever see. Our future King lobbying for a company he had a secret investment in would come under that.

[ckn]

Just now, gingerjon said:

My understanding is that there's enough UK-ness in the process to mean that HMRC do have at least cause to investigate.  The likelihood of them winning is slight though because, as I say, UK law tends to do it all on technicalities (hence why, as far as I'm aware, we still have prosecuted anyone about Madoff) unlike the US where they just prove you're a lying get and have done with it.

But, as I said a while back, ultimately the legal/illegal stuff is just the crumbs being fed for useful idiots to get worked up about. The real stuff, the fun, juicy stuff, is the light thrown on all manner of shady connections which have either been lied about by omission or just plain hidden away in the hope that no one would ever see. Our future King lobbying for a company he had a secret investment in would come under that.

On our royals, I see Andrew as just lacking subtlety rather than being the outlier, if that helps position me on them.

[gingerjon]

2 minutes ago, ckn said:

On our royals, I see Andrew as just lacking subtlety rather than being the outlier, if that helps position me on them.

I wouldn't position you on a royal if you paid me ...

[ckn]

2 minutes ago, gingerjon said:

I wouldn't position you on a royal if you paid me ...

Thank you... I think...

[Griff9of13]

21 minutes ago, ckn said:

On our royals, I see Andrew as just lacking subtlety rather than being the outlier, if that helps position me on them.

I don't think it was Andy he was referring to.

[ckn]

7 minutes ago, Griff9of13 said:

I don't think it was Andy he was referring to.

Yep, got that, I was just setting the benchmark for what I think of the royals as a bunch.  Some are outliers, Andy isn't one of them.

[Saintslass]

7 hours ago, John Drake said:

Changing the tax laws and giving HMRC the resources to enforce them just might, though.

On this point, maybe you could lobby the BBC and the Guardian as both have refused to hand over the papers to HMRC.

Funny how the BBC and the Guardian have both taken the same view on this.  I wonder why?