where is the money. where have all the unpaid taxes gone

bubblesmoney

ever wonder how the govt will go hammer and tongs at the person on the street with fines etc if taxes arent paid on time.

now if a small company in your town does a business or service even as small as washing windows or removals service they will get a VAT charge plus corporation taxes or income taxes etc

now do they do the same with the high fliers????

think about it. there have been trillions of money worth of derivatives transactions most of it over the counter (OTC). many people estimate it to be worth around 600 - 800 trillion dollars. where are the VAT taxes for all these transactions, where are the income taxes for all the profits of all these years??? why have all these taxes not been paid? why is the govt not getting the taxes from the big corporations who indulged in these transactions???

even if there was a 1% tax on these transactions as majority of these occured in london (remember it being sold as the financial capital of the world) then 1% of 800 trillion should be 8trillion in taxes. but if there were many other transactions over trhe years they were all due their taxes. where the hell have all these unpaid taxes of trillions of dollars disappeared. even if the tax was just 0.1% then the govt should still have got 800billion dollars in taxes and would not have needed any debt for any bailouts.

remember all the small businesses in your town will be paying VAT for all small services and transactions even if they dont make a profit at the year end but why havent these big corporations been paying the taxes for these trillions worth of transactions???

food for thought.

drc

Aren't these all the 'losses' that we hear so much about? Surely all this tax revenue is being pumped back into the system in the form of bailout money? So, it's not going to be spent on roads, schools, NHS etc but on bailing out the banks?

bubblesmoney

drc wrote: »

Aren't these all the 'losses' that we hear so much about? Surely all this tax revenue is being pumped back into the system in the form of bailout money? So, it's not going to be spent on roads, schools, NHS etc but on bailing out the banks?

i am talking about clawing back the arrears from all hedge funds and any financial entity that made these financial transactions (CDS, CDO, CDS square and what nots) in the uk.

dont all the small fry like us pay VAT on many transactions. then why exempt the bigger payers. you call a carpet cleaning company they will charge VAT, call a removals (one man business) VAT will still be charged, have a meal at a small restaurant tax will still be charged, buy property you pay duty, pay insurance again the same story, buy car insurance, break down cover etc you pay taxes again.

but when you buy and sell billions / trillions in securities in over the counter transactions (CDS etc which basically are one type of insurance / hedges) then you seem to get away without paying taxes. i am not aware they pay taxes on these OTC transactions. if they indeed did pay taxes then the uk coffers would have been overflowing now. london was the financial nerve centre which means majority of these transactions would have been routed through london most probably. so even a 0.1% tax or VAT would have raised anywhere between 500-800 billion depending on the number of transactions and amount involved in the securities traded OTC in the uk by all these financial institutions.

companies still pay VAT on goods or services performed and billed even if they make a loss at the end of the year. so why the exclusion for people involved in these types of securities?

naked CDS etc is basically gambling then why is it not under the purview of the gambling commission as well. why is it allowed to run as OTC products escaping regulatory purview?

amcluesent

>why is the govt not getting the taxes from the big corporations who indulged in these transactions?<

Probably all registered offshore. Govt chooses to ignore this, for example the public sector continues to splurge ££ millions on IT contracts with Accenture, who are registered in a tax haven so that the partners can minimise tax.

bubblesmoney

amcluesent wrote: »

>why is the govt not getting the taxes from the big corporations who indulged in these transactions?<

Probably all registered offshore. Govt chooses to ignore this, for example the public sector continues to splurge ££ millions on IT contracts with Accenture, who are registered in a tax haven so that the partners can minimise tax.

even if registered offshore, any transaction that occurs on uk sovereign areas should come under UK taxation laws. these tax havens are just a method for the rich to escape taxation which they expect the people earning less to pay without fail.

why should a person earning 14k a year have to pay VAT but the same does not apply for a trillion dollar transaction done in the UK by a company.

Radiantsoul

bubblesmoney wrote: »

ever wonder how the govt will go hammer and tongs at the person on the street with fines etc if taxes arent paid on time.

now if a small company in your town does a business or service even as small as washing windows or removals service they will get a VAT charge plus corporation taxes or income taxes etc

now do they do the same with the high fliers????

think about it. there have been trillions of money worth of derivatives transactions most of it over the counter (OTC). many people estimate it to be worth around 600 - 800 trillion dollars. where are the VAT taxes for all these transactions, where are the income taxes for all the profits of all these years??? why have all these taxes not been paid? why is the govt not getting the taxes from the big corporations who indulged in these transactions???

even if there was a 1% tax on these transactions as majority of these occured in london (remember it being sold as the financial capital of the world) then 1% of 800 trillion should be 8trillion in taxes. but if there were many other transactions over trhe years they were all due their taxes. where the hell have all these unpaid taxes of trillions of dollars disappeared. even if the tax was just 0.1% then the govt should still have got 800billion dollars in taxes and would not have needed any debt for any bailouts.

remember all the small businesses in your town will be paying VAT for all small services and transactions even if they dont make a profit at the year end but why havent these big corporations been paying the taxes for these trillions worth of transactions???

food for thought.

Generally there is no VAT on derivatives. Companies are liable for corporation tax on trading gains, but derivatives are a zero sum game. For every winner there is a loser and so in theory the net tax will be zero(obviously differing tax regimes will complicate). In practice these trades are often undertaken in the UK on behalf of other countries by our finance sector and UK institutions will have taken a very small margin on which they will have paid corporation tax.

I believe that the idea of a tax on these transactions is rather similiar to a Tobin tax. The benefits would be a large sorce of revenue, the costs would be a rolling back of globalisation and presumably increased volatility in commodity prices.

Kez100

They don't add VAT because these plonkers never added any value. LOL.

Running_Horse

Promises, promises, promises.

http://www.youtube.com/watch?v=r3xKI2mz_QA

chewmylegoff

companies, including banks, are already taxed at 30% of their profit .

all the staff who were paid cash bonuses paid 40% tax, the companies paid 12% employers NI. if they were paid in shares they paid CGT on profits.

i don't know quite what you want on top of this.

when you enter into a derivative with a share as the underlying, the institution which sells the derivative to you will usually hedge its own position by buying the underlying shares. they have a stamp duty exemption so pay nothing. i suppose you could abolish that exemption, or just subject derivatives contracts to stamp duty, but i don't see how that will help. it will just mean that it will be more expensive, with the result that london transacts less derivatives business.

bubblesmoney

chewmylegoff wrote: »

companies, including banks, are already taxed at 30% of their profit .

all the staff who were paid cash bonuses paid 40% tax, the companies paid 12% employers NI. if they were paid in shares they paid CGT on profits.

i don't know quite what you want on top of this.

when you enter into a derivative with a share as the underlying, the institution which sells the derivative to you will usually hedge its own position by buying the underlying shares. they have a stamp duty exemption so pay nothing. i suppose you could abolish that exemption, or just subject derivatives contracts to stamp duty, but i don't see how that will help. it will just mean that it will be more expensive, with the result that london transacts less derivatives business.

i know the employees paid their taxes. but so does the common man, they pay income tax, CGT etc too. plus the common man when he buys things or buys a service he still pays VAT. but these enormous transactions dont get VAT or a transaction tax. that is what i was pointing out. when the size of these transactions is of the magnitude of many times the worlds GDP, they pose a significant risk to the system (as can be seen now). so they need to be appropriately taxed and regulated so that needless risk is not taken and the tax revenues might compensate for the risk to the system. naked CDS etc is just betting so it is not exactly beneficial to the system. the parties to the exchange of contracts might be registered offshore so they wont be paying any income tax at all in such cases. i bet the majority of such derivative contract exchanges would have been routed via offshore facilities but transacted in the uk.

any transactions that are a risk to the system must be regulated and appropriately taxed. these risky transactions have ruined the biggest banks and ruined thousands of peoples savings and pensions, was it all worth it just for the sake of a share of the risky transactions generating margins here without regulation. if just losing business was a concern then the drug trade could be legalised too and that would generate a lot of transactions ! but it isnt the right thing to do.

chewmylegoff

banks do pay VAT on things they buy. they can only claim VAT back on expenditure relating to VATable turnover. lending money to people, and messing about with derivatives contracts are not VATable. Hence they pay VAT in the same way as you do when you buy something.

banks also pay corporation tax, so any profit they make from derivatives business is taxed in the same way as any other profit.

what you essentially seem to be saying is that banks should pay tax twice on certain elements of their business - they should be taxed on the transaction and the profit. the only point of doing this would be if you wanted to drive derivatives business out of the UK and into other financial centres.

if that's what you want to achieve you might as well make it illegal - either way you aren't going to see any additional tax revenue.