The tax avoidance double standard strikes again

Industry news roundup: week ended 3 Oct 2013:

Is it just me or is there a major double standard when it comes to being punished for tax avoidance in this country?

It seems as if the larger a company you are – or maybe the more money you have to devote to your accountancy department – you can get away with murder when it comes to making tax payments. I mean let’s look at the facts here: Search giant Google just got called out for making £3.5 billion in sales in the UK over the course of 2012, yet only paying £11.6 million in corporation tax.

Honestly this is nothing new, as Google has been drawing ire for its tax avoidance schemes for years – but the problem is that the multinational isn’t doing anything illegal since it has a cadre of accountants that know every single legal loophole there is. Not only that, but I’m sure there are plenty of ‘campaign contributions’ that multinationals such as Google make to MPs, resulting in more or less buying votes when it comes to the approval of tax reform measures in Parliament. Not that I have any proof but let’s be real here for a moment – have you ever known a politician that wasn’t amenable to representing the interests of the highest bidder?

Of course if you’ve got nothing to offer between political power or cold hard cash, you’re going to end up in hot water if you try to engage in tax avoidance. That’s exactly what happened to a pair of brothers who were found to have ‘neglected’ to pay £1.3 million worth of VAT – they’ve been banned from running any sort of company for an eye-watering  eight years each!

I’m not saying that what the brothers did wasn’t wrong – because obviously it was – but how is it that a pair of small-time real estate company directors end up with massive penalties but Google and other big-time multinationals are simply groused at a bit and left to go on with their own devices? It must be grand to have enough expertise to funnel your profits to a massive tax shelter offshore in the Cayman Islands, well out of reach of the grasping hands of the taxman. Until we stop rewarding this kind of behaviour, we’re never going to be free of it – and the little guy is still going to get strung up every time he’s tripped up.

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