Big business creating £ & input to the economy...

Wookster

Generali wrote: »

Amazon do pay tax but not corporation tax.

I don't really get this hatred of 'tax avoidance': the rules are set by the Government and companies/individuals either follow them or break them. If the rules are bad then the Government should change them.

Part of the problem is that HMRC don't seem to be doing their job properly. It seems that they pursue individuals much more vigorously than they do companies.

Personally, the little I know about trading with vs trading in & transfer pricing leads me to believe that with proper scrutiny, Amazon may well be found to be treading the wrong side of a rather fine line.

What is necessary is for HMRC to be properly accountable to Parliament (as Margaret Hodges has long been fighting for) so that their agreements are up for scrutiny.

Thrugelmir

lemonjelly wrote: »

Whereas by avoiding paying corporation tax altogether, means only the company benefits!

There's a fairness issue here. They use social facilities (transport, infrastructure etc etc) yet don't contribute. Hence peoples concerns...

Brown made the UK uncompetitive on the global stage for companies to be based here. Thats the issue.

The US has same the problem. As multinationals are keeping their profits off shore.

As I've said previously with regards to labour pay rates. The world is going global and therefore differentials over time will narrow.

HAMISH_MCTAVISH

lemonjelly wrote: »

Whereas by avoiding paying corporation tax altogether, means only the company benefits!

There's a fairness issue here. They use social facilities (transport, infrastructure etc etc) yet don't contribute. Hence peoples concerns...

I think people that are concerned about this issue really don't understand the bigger picture.

Businesses trading in the UK generally pay all the taxes that UK law requires them to pay on UK generated revenue.

And to that extent, UK taxes on UK activities aren't really a company tax at all, they're just another tax on the consumer, one step removed.

The issue is around whether or not corporations should be based here and pay taxes here on revenue earned overseas. So whether or not the UK government gets a slice of the pie from the money spent by American, or French, or German or Russian consumers in their countries.

But there is no reason any multinational must be based here. They are free to shop around for countries which offer lower tax rates, and relocate their head office there if the benefits outweigh the disadvantages to them.

Countries must compete with each other to attract that tax revenue, and the competition revolves around not just tax rates, but also business friendly policies, infrastructure, etc.

If a significant number of companies are basing themselves elsewhere, then the UK is obviously getting the balance wrong and failing to compete effectively in that market.

You can't keep a company, or high earning individuals, hostage in the UK and force them to pay tax here..... We must compete for that revenue, and it's clear that taxes above a certain level will be counterproductive in that regard.

chewmylegoff

lemonjelly wrote: »

Whereas by avoiding paying corporation tax altogether, means only the company benefits!

There's a fairness issue here. They use social facilities (transport, infrastructure etc etc) yet don't contribute. Hence peoples concerns...

If the govt has established a system which allows a company incorporated in Luxembourg to sell stuff to people on the Internet and to distribute that stuff to said people from warehouses located in the uk without having to pay tax then the govt is to blame not the company. Let's face it amazon isn't going to stop selling to uk persons if it has to pay more tax, so the govt should sort itself out.

kabayiri

Generali wrote: »

Amazon do pay tax but not corporation tax.

I don't really get this hatred of 'tax avoidance': the rules are set by the Government and companies/individuals either follow them or break them. If the rules are bad then the Government should change them.

I can't say that on a moral level I support tax avoidance but I don't have a hatred for it.

I am more interested in who really sets the agenda nowadays : nation state or big business ?

Big business has always sought to minimise their tax burden as part of a drive to reduce their cost base.

It's just that nowadays I think they have a lot more tools at their disposal. The legal and accounting industry have a large arsenal of tools to work any legislation or rules a government imposes.

I do believe that without economic growth Osbornes' deficit reduction plans are in tatters. Recently some Conservative spokesman was quite open on the radio - they believe central Europe is moving towards more regulation and that we should position the UK as a low tax / light regulation economy. Eurozone's loss is our gain perhaps?

Will it work? Who knows, but we are in for interesting times

Thrugelmir

kabayiri wrote: »

I do believe that without economic growth Osbornes' deficit reduction plans are in tatters. Recently some Conservative spokesman was quite open on the radio - they believe central Europe is moving towards more regulation and that we should position the UK as a low tax / light regulation economy. Eurozone's loss is our gain perhaps?

Will it work? Who knows, but we are in for interesting times

Agree totally. Though not light regulation when it comes to banking.

chewmylegoff

Regulation mostly comes from the EU now so there is little we can do, especially as our national culture is to take regulation seriously (note that is different from doing it well) - taxation is the most effective way of making the UK competitive.

Thrugelmir

chewmylegoff wrote: »

especially as our national culture is to take regulation seriously (note that is different from doing it well) -

Don't belittle the standards in the majority of industry and commerce. In many areas the UK is well respected.

Bribery of some form is still extremely common in many supposedly developed countries.

chewmylegoff

Thrugelmir wrote: »

Don't belittle the standards in the majority of industry and commerce. In many areas the UK is well respected.

Bribery of some form is still extremely common in many supposedly developed countries.

Regulation and ethical standards of doing business are not the same thing.

And from what comes across my desk on a daily basis I know that bribery and corruption is alive and well in this country (although as you say, at least it is not systemic as it is in dozens of other countries).

IronWolf

Firstly, corporation tax is paid on profits, not sales, so I have no idea why they quote £3.3bn sales figures, probably because they're morons.

Second, on that £3.3bn we are collecting VAT, which dwarves any corporation tax we would receive on profits given Amazon is a low profit margin business.

So do people want to forgoe the corporation taxes that the big UK exporters bring into the country by selling their goods abroad? Are they happy to let those countries theyre selling in have those corporation tax revenues instead?

Thought not, socialists think there is just 1 country and you can tax companies whatever you want.