Page 1 of 43 12311 ... LastLast
Results 1 to 15 of 643

Thread: MNC Corporation Tax - avoidance and payments. UPDATE June 2014- EU State Aid Investigation to Commence

  1. #1
    Join Date
    Mar 2010
    Location
    heart of Europe
    Posts
    22,718

    Default MNC Corporation Tax - avoidance and payments. UPDATE June 2014- EU State Aid Investigation to Commence

    Starting a new thread here as this issue got included in a separate thread

    Quote Originally Posted by Captain Con O'Sullivan View Post

    I have this horrible feeling that when you look at some foreign Multinationals in Ireland they are actually costing us money to have them in the state.

    The benefits are supposedly (a) jobs (b) corporation tax (c) onward economic activity domestically and exports abroad.

    If Irish taxpayers are effectively subsidising any of that for a major employer I'd want to know where the line is between national profit and national loss in kowtowing to them.

    The point is at the moment that there is an assumed narrative around this kind of thing that MNCs take advantage of and I'd like to be able to point to any company of size in the state and say 'this is how much we can support this company before moving into a loss on it'.
    People in the UK are slowly realising the tax scam engaged in by multinationals


    Coffee chain Starbucks was left on the back foot yesterday – after a growing internet campaign called on consumers to boycott the company over its tax dealings in the UK.

    The company hit the headlines after it was revealed it had paid just £8.6m in tax in the 13 years it has been in the UK.

    Now, an MP has called for an inquiry into the situation – despite Starbucks having done nothing illegal.
    Meanwhile, Starbucks said: “We make sure that multinationals pay the right tax to the UK in accordance with UK tax law.” It declined to say if it was considering any changes to its accounting practices but said it was “totally committed to the UK”.
    http://www.bakeryinfo.co.uk/news/ful...continues.html

    Suggestions that Starbucks is avoiding tax changes that. We do have homegrown coffee shops in the UK. A lot of them. And they have to pay their taxes in full here in the UK. They can't make payments to offshore entities for the use of their logos or advice on how to add hot water to coffee just to avoid tax: they have to pay in full on what they earn in this country. What Starbucks is doing may be legal, but what it also shows is that business does not operate on a level playing field in the UK.

    Reuters is suggesting that Starbucks use offshore licensing, transfer pricing that routes profits to Switzerland and intra-group funding to reduce their UK profits. The result is that despite Starbucks apparently being a highly successful operation – something they do not just acknowledge, but make a point of saying – they haven't paid tax here for the last three years.
    And let's straight away dismiss the "but their employees pay income tax and NIC and their customers pay VAT" argument: that's equally true of their UK-based competitors who must also pay corporation tax.

    What's clear from what's happening is something that's been glaringly obvious to a few for a long time, but for which there hasn't been a clear example, and that is that multinational companies and the rules by which they can trade very obviously provide a clear, unfair and wholly unjustifiable competitive advantage to such corporations over smaller, locally owned and nationally based businesses.

    This makes no economic sense. First, even the most pro-market person will say that tax should not distort markets. On this occasion I agree with them: there is no reason at all why the UK tax system should favour one company over another in this country when they are in direct competition one with another.

    More than that though, if there is to be any such competition it should be the smaller, homegrown business that should very clearly get the support of the tax system. But it isn't: the exact reverse is happening.
    http://www.guardian.co.uk/commentisf...itish-business

    Facebook too

    Facebook has been accused of taking the British taxpayer for a ride after experts suggested the company had depressed sales figures and that the website's average UK employee earned more last year than the whole social media network paid the exchequer.

    The British arm paid its 90 UK-based staff an average of £275,000 each in 2011 while contributing just £195,890 to the Treasury's coffers, according to the firm's latest accounts filed at Companies House.

    The website also reported UK revenues of £20.4m, a fraction of the £175m that media analysts estimate the firm made in the UK in 2011.

    Most of the sales are believed to have been booked in the firm's international headquarters in Dublin, where they will attract lower corporation taxes.

    Richard Murphy, of Tax Research UK, said: "The UK is being taken for a ride. Facebook is taking standard practice for these IT companies to a new high, or low, depending on how you look at it. The UK is giving the tax break and the Irish get benefit of all the tax on the sales."

    The chartered accountant added that the arrangement between Facebook UK and its Dublin office suggests that only around 11% of total sales made into the UK are declared in this country – a standard industry mechanism whereby a UK-based company is paid a commission for the sales it generates by a sister company located in a lower tax jurisdiction.

    Furthermore, Facebook UK's latest figures show that the company charged £15.4m to its 2011 accounts – which can be used to reduce future tax bills – as a cost of awarding its UK staff share options. Murphy said: "That appears to be £15.4m to reward £20.4m in sales. That makes no sense. The options must, of course, be based on the value of sales recorded in Ireland but the UK is bearing the cost of the tax relief on paying these options."

    When asked if Facebook had chosen to set up its international headquarters in Dublin in order to lower its tax bill, a company spokeswoman responded: "We have our international headquarters in Ireland that employs hundreds and a series of smaller local offices providing support services all over Europe. Dublin was selected as the best location to hire staff with the right skills to run a multilingual hi-tech operation serving the whole of Europe."
    http://www.guardian.co.uk/technology...edium=linkedin
    Last edited by C. Flower; 08-06-2014 at 08:16 PM.
    Politics is the gentle art of getting votes from the poor and campaign funds from the rich, by promising to protect each from the other. ~Oscar Ameringer

  2. #2
    Join Date
    Mar 2010
    Location
    heart of Europe
    Posts
    22,718

    Default Re: Corporation Tax - avoidance and payments

    Starbucks in Ireland is at the same caper as Starbucks in the UK

    Coffee-shop chain Starbucks has only paid €35,000 in taxes in Ireland since 2005, while paying €5.7m in royalty and licensing fees to its parent company, accounts filed by the US coffee chain’s wholly-owned Irish subsidiary Ritea Ltd show.

    Accounts filed by Ritea — owned by Dutch-based Starbucks Coffee Emea — record a loss every year it has been in operation in Ireland except for 2011, when the company recorded a €524,944 profit on which €34,980 in tax was paid.

    However, over the same period, the company paid millions in royalties and licensing fees.

    The paper losses show how multinationals the world over use perfectly legal tactics to minimise tax leakage in the different regions where they operate.
    http://www.irishexaminer.com/busines...t--211055.html
    Politics is the gentle art of getting votes from the poor and campaign funds from the rich, by promising to protect each from the other. ~Oscar Ameringer

  3. #3
    Join Date
    Mar 2010
    Location
    heart of Europe
    Posts
    22,718

    Default Re: MNC Corporation Tax - avoidance and payments.

    I would safely assume McDonald's are at the profit reduction game too

    No doubt the Irish operation are paying HQ (or Switzerland) for branding etc

    In a recent interview with the Irish Times Atherton would not divulge a figure for “system-wide profits” but said tax paid in 2009 was €3.3 million. Based on a 12.5 per cent rate, this would indicate a profit of €26.4 million.
    http://www.kepakfoodservice.ie/mcdon...ing-recession/
    Politics is the gentle art of getting votes from the poor and campaign funds from the rich, by promising to protect each from the other. ~Oscar Ameringer

  4. #4
    Join Date
    Mar 2010
    Location
    heart of Europe
    Posts
    22,718

    Default Re: MNC Corporation Tax - avoidance and payments.

    Brilliant line from Arthur Cox in this: http://www.arthurcox.com/uploadedFil...ary%202011.pdf


    "the scope of what is considered to constitute "trading activities" is quite broad
    Politics is the gentle art of getting votes from the poor and campaign funds from the rich, by promising to protect each from the other. ~Oscar Ameringer

  5. #5
    Join Date
    Mar 2010
    Location
    heart of Europe
    Posts
    22,718

    Default Re: MNC Corporation Tax - avoidance and payments.

    e-bay in the UK press today.

    The American company legally channels payments through Luxembourg and Switzerland, resulting in it paying barely more than £1m in corporation tax, despite generating sales of almost £800m in the UK in a year, according to a Sunday Times investigation.

    The paper reported that accounts filed in America by eBay Inc, the parent company, indicate that its British subsidiaries generated £789m in sales during 2010. The company’s UK shopping portal has 17m unique visitors a month.
    Using a group-wide profit margin of 23pc, UK profits would have been £181m in 2010, the latest year for which accounts are available. At the time this would have produced a corporation tax bill of £51m. However, the amount of tax paid in total by eBay’s four main UK-based subsidiaries for that year was £1.2m.
    This old chestnut!

    Accounts also show that eBay (UK), the main British subsidiary, merely provides “services” to a company in Switzerland called eBay International AG.
    http://www.telegraph.co.uk/finance/n...tax-in-UK.html
    Politics is the gentle art of getting votes from the poor and campaign funds from the rich, by promising to protect each from the other. ~Oscar Ameringer

  6. #6
    Join Date
    Mar 2010
    Location
    heart of Europe
    Posts
    22,718

    Default Re: MNC Corporation Tax - avoidance and payments.

    The Starbucks CEO was just on CNBC claiming they did not pay corporate tax in the UK because they "failed to make a profit". Failed to mention that this "failure" was due to internal charges designed to eliminate any profit.
    Politics is the gentle art of getting votes from the poor and campaign funds from the rich, by promising to protect each from the other. ~Oscar Ameringer

  7. #7
    Join Date
    Mar 2010
    Location
    heart of Europe
    Posts
    22,718

    Default Re: MNC Corporation Tax - avoidance and payments.

    The French have realised there is a game afoot.

    The French tax authorities claim Google Ireland operates in France “using the human and material resources” of Google’s French subsidiary, but that it has failed to declare this activity for tax purposes. The authorities’ “presumption of fraud” rested on “the fact that employees of Google France appear to be in charge of the negotiation and management... of the portfolio of ‘big accounts’ for the Irish-registered company”, the court noted.
    http://www.irishtimes.com/newspaper/...326036937.html
    Politics is the gentle art of getting votes from the poor and campaign funds from the rich, by promising to protect each from the other. ~Oscar Ameringer

  8. #8
    Join Date
    Aug 2011
    Location
    hiding inside Brendan Gleesons underwear drawer...
    Posts
    13,555

    Default Re: MNC Corporation Tax - avoidance and payments.

    There is a protest I think today at 1pm in College Green to protest against Starbucks at its branch there
    History is the only true teacher, the revolution the best school for the proletariat - Rosa Luxembourg

  9. #9
    Join Date
    Oct 2010
    Posts
    1,832

    Default Re: MNC Corporation Tax - avoidance and payments.

    See my post on the 'other' thread - ironically Starbucks do sandwiches don't they

    "globalisation" has thrown up a number of tricks - the problem is that, like the so-called Tobin Tax on financial transactions, as long as one country doesn't apply it the tax wonks will move everything there to avoid paying. The reality is that, for many of these tricks, they don't even need to be in the place to do the business, just to be registered there.

    Ho-hum.

    B

  10. #10
    Join Date
    Mar 2010
    Posts
    12,044

    Default Re: MNC Corporation Tax - avoidance and payments.

    There you have described the entire reason for the IFSC's existence.
    Think National. Act Local. Oh- and superstition is just the dark matter of human history.

  11. #11
    Join Date
    Mar 2010
    Location
    heart of Europe
    Posts
    22,718

    Default Re: MNC Corporation Tax - avoidance and payments.

    Apple paying a whopping 1.9% on earnings outside the US

    Apple paid less than 2% tax on its overseas profits, papers filed with US regulators have revealed.

    The iPad and iPhone giant is the latest company to come under criticism over poor overseas tax contributions, following Starbucks, Facebook and Google.

    Apple paid 713 million US dollars in corporation tax outside the US in the year to September 29. Its overseas earnings, however, increased more than 50% to 36.8 billion US dollars.
    The slide in the company's overseas tax rate, from 2.5% the previous year to 1.9%
    http://www.itn.co.uk/World/60560/app...tax-outside-us
    Politics is the gentle art of getting votes from the poor and campaign funds from the rich, by promising to protect each from the other. ~Oscar Ameringer

  12. #12
    Join Date
    Nov 2010
    Location
    in the national interest
    Posts
    17,668

    Default Re: MNC Corporation Tax - avoidance and payments.

    No doubt events stateside are sharpening the focus lately but it's interesting the amount of coverage about. Big stories daily now.
    Have the poor run out of money or something?

  13. #13
    Join Date
    Mar 2010
    Location
    heart of Europe
    Posts
    22,718

    Default Re: MNC Corporation Tax - avoidance and payments.

    On Apple

    In the late 1980s, Apple was among the pioneers in creating a tax structure — known as the Double Irish — that allowed the company to move profits into tax havens around the world, said Tim Jenkins, who helped set up the system as an Apple European finance manager until 1994.

    Apple created two Irish subsidiaries — today named Apple Operations International and Apple Sales International — and built a glass-encased factory amid the green fields of Cork. The Irish government offered Apple tax breaks in exchange for jobs, according to former executives with knowledge of the relationship.

    But the bigger advantage was that the arrangement allowed Apple to send royalties on patents developed in California to Ireland.
    http://dublinopinion.com/2012/08/30/...tax-avoidance/
    Politics is the gentle art of getting votes from the poor and campaign funds from the rich, by promising to protect each from the other. ~Oscar Ameringer

  14. #14
    Join Date
    Mar 2010
    Location
    heart of Europe
    Posts
    22,718

    Default Re: MNC Corporation Tax - avoidance and payments.

    Politics is the gentle art of getting votes from the poor and campaign funds from the rich, by promising to protect each from the other. ~Oscar Ameringer

  15. #15
    Join Date
    Nov 2010
    Location
    in the national interest
    Posts
    17,668

    Default Re: MNC Corporation Tax - avoidance and payments.

    while I think of it, from this month's Alive!


Page 1 of 43 12311 ... LastLast

Bookmarks

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •  
Share us
Follow Us