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Paradise Papers

Discussion in 'The Lounge' started by MickLL, Nov 7, 2017.

  1. MickLL

    MickLL Well-Known Member

    I suspect that this might become lively! Please accept that there is an element of Devil's Advocate in what follows.

    The so called Paradise Papers appear to be showing that a number of well known (and rich) people and some companies have arranged their tax affairs to reduce the level of tax they pay.

    As far as I'm aware none of them have broken any law in any country. So all the furore boils down to a question of morality. Now , in my book, morality , in part, is a movable feast. What's moral and what isn't depends on a whole number of factors - the subject of an essay in itself. One that I'm not about to write.

    I also think that if we, as a country, wish to stop these tax avoidance schemes then it ought to be possible. The fact that they exist is a failing of Government (or of HMRC). Now before folk start screaming about Tories looking after their mates stop and think and answer the question what did the Labour lot do about it when they were in power? I'm making the point that it's not a single party issue. Both of the major parties have had their chance and , it seems, did little or nothing.

    Now before the castigation begins consider your own position. Have you arranged your affairs to pay maximum tax? I'll place a reasonable bet that you have not. Here's some of the things that you might (or even probably) have done to reduce your tax bill. You might have made pension contributions and got tax relief. You may have an ISA to avoid tax. You may have arranged your estate to minimize inheritance tax. You may be making tax free lifetime gifts to your kids to avoid tax. And so on. If you have done any of those things (or any of the many other things open to us) then the difference between you and some of the folk currently in the news is simply one of scale.

    Discuss!!!

    MickLL
     
    SqueamishOssifrage likes this.
  2. Snorri

    Snorri Well-Known Member

    Both parties have friends and members that need looking after... I hope it will shake up the system.
     
  3. peterba

    peterba Well-Known Member

    An interesting post, Mick. Hopefully an intelligent and thoughtful discussion will ensue. o_O

    It's true that the Labour Party certainly did little or nothing in this regard, in its guise as pale-blue Tories - however, things would possibly/probably be different under the current leadership.

    For me, none of these points apply, other than a pension which - as you point out - gave tax relief when I was paying into it. However, this is available to all (who can afford to pay into a pension), and has been actively encouraged by all governments, so I don't see any major moral issue there. There is of course the problem that the less well-off probably can't afford a pension, so they don't benefit from the tax relief, but they should (but possibly don't:() get other benefits.

    I would also say that - despite my relatively low income these days - I would gladly pay more tax in order to contribute to the redistribution of wealth, and/or to finance improved public services. I do not, however, wish to pay more tax to finance additional weapons of mass destruction, or to help plug the holes in the public finances caused by the tax-evasion/avoidance schemes of the 'super-rich'.
     
    Last edited: Nov 7, 2017
  4. miked

    miked Well-Known Member

    As far as I'm aware none of them have broken any law in any country.

    Change the law, is my answer to this problem. Ordinary folk in the UK pay their taxes and, indeed, are pursued with vigour by HMRC if they fail to do so, and are penalised for late submission of their tax return forms. The clear lack of political will to address this problem has, in my opinion, much to do with financial contributions to political parties by individuals seeking to 'purchase' political favours. Billionaires and such ilk have never had much of a moral component in their financial affairs; they enjoy power and influence to an astonishing degree. In financial terms London and the UK has become a huge laundry for dirty money, be it from Russian and various other countries' corrupt oligarchs who buy up properties and companies so as to launder their ill-gotten wealth. Until we elect a government that chooses to resist financial inducements (bribes) from such people we will just have to accept that democracy is fast becoming a pipe dream.
     
    peterba likes this.
  5. spinno

    spinno Well-Known Member

    Q:Which companies advise HMRC on tax matters in particular compliance issues?
    A:Many of those which advise people how to avoid paying more tax than they should, could or would.
     
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  6. SXH

    SXH Well-Known Member

    Companies who also poach staff from HMRC, to help develop even more schemes.

    I worked for the revenue for a while and a couple of friends moved to accountancy firms to do just that.
     
    peterba likes this.
  7. spinno

    spinno Well-Known Member

    Indeed. If you remember the Union Magazine (Assessment) used to carry numerous ads seeking "Specialists" at salaries that couldn't be turned down.
     
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  8. peterba

    peterba Well-Known Member

    I've been 'liking' these posts, but I could really do with an 'agree' button, instead... ;) (Oh no, let's not start that again )
     
  9. spinno

    spinno Well-Known Member

    two canderels is it...;)?
    well they are sweeteners after all....



    Sat in my coat just in case
     
    peterba likes this.
  10. peterba

    peterba Well-Known Member

    Oh yes, that's a good one! :D (That was definitely a 'like', rather than an 'agree'...)
     
    Last edited: Nov 7, 2017
  11. miked

    miked Well-Known Member

    In mentioning civil servants' recruitment by finance companies, have we forgotten the very unseemly move by HMRC chief David Hartnett to Vodaphone, a company who recruited him very shortly after he had arranged what many observers thought was a rather over-generous tax arrangement for that company. And on the same subject, why has there not been a law to stop the seamless transition of government ministers and senior civil servants who have had close dealings whilst in government with companies who, when these self-same ministers/civil servants leave office, move straight into senior management positions at those very companies? Some folk might regard this practice as a huge incentive to collaborate (ie, facilitate) 'sweetheart' deals.
     
    steveandthedogs and peterba like this.
  12. SXH

    SXH Well-Known Member

    From what I remember from the regular Revolving Door (as they call it) stories in Private Eye, these moves have to be OKed by a Parliamentary or Civil Service committee.

    They are very rarely not OKed...
     
    Trannifan likes this.
  13. spinno

    spinno Well-Known Member

    At one time if you left our department for a period of time (can't remember how long a year or two I think) you had to obtain permission to take up the job....and we weren't senior civil servants (well unless you mean age...)
     
  14. miked

    miked Well-Known Member

    So that's all right then? Perfectly above board. The "ethical" approving the unethical.
     
  15. Andrew Flannigan

    Andrew Flannigan Well-Known Member


    I ran a small business for many years and we paid every single penny of tax due without being asked for it. Every few months we'd get bumf from accountants telling us they could save us huge sums. These were filed in the paper recycling box without further attention. We obviously took the tax allowances where appropriate and reclaimed VAT on the business expenditure that justified it but nothing more. We applied the same rules to using ISAs and pension payments. Even if the cash flows had justified it I'd never have considered off-shoring and nor I'm convinced would most of the small businesses that keep the money moving in this country.
     
  16. SXH

    SXH Well-Known Member

    Where did I say that? Personally, I think it stinks and people taking such jobs should have at least a years 'gardening leave' before taking them up.
    In the privatised company I used to work for people in certain departments, above a certain level, had it in their contracts that if they moved to a competitor in a similar position, they had to take six month's gardening leave, to avoid passing on current, sensitive information. Which, iirc, wasn't covered by restraint-of-trade legislation.
     
  17. MickLL

    MickLL Well-Known Member

    You give the impression that you are OK with ISA's but against offshoring. Maybe you missed my point which was that they are fundamentally the same. Both are legal methods of reducing your tax bill. I suppose that difference , and where folk begin to get excited, is that the ISA is deliberate but the offshore accidental (on the part of the Government regualtions covering such things).

    Nevertheless they are both legal and IMHO people can't be blamed for using either - as you apparently did with ISA's.

    Another question (to everyone not especially aimed at Andrew). How many have their savings, if any, in the name of their wife/husband so that the partner, assuming that they are not a tax payer, doesn't pay tax on interest whereas you would? Immoral? Not in my book.

    MickLL
     
  18. peterba

    peterba Well-Known Member

    We don't have that arrangement, even though my other half's pension is not enough to put her into income tax, whereas mine is enough to put me above the threshold (albeit only a short way above it). I hope it doesn't sound too self-righteous when I say that the reason is that I prefer to pay the tax due on the taxable amount above the threshold, without resorting to manipulation in order to avoid it.
     
  19. miked

    miked Well-Known Member

    I disagree. Ex ministers and civil servants ought to be permanently disqualified from any pecuniary post with a company with whom they dealt with during office. And, further, should be disqualified from any subsidiary company. Are their pensions not already bloated?
     
  20. Malcolm_Stewart

    Malcolm_Stewart Well-Known Member

    I think I agree in principle, but would any decent people then go into public life? Once in parliament, I guess the atmosphere is such that they expect to get handsomely rewarded.
     

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