Why Wont They Chase The Big Boys?

[youngmafbog]

http://news.sky.com/story/1184447/hmrc-failing-to-pursue-big-business-mps-warn

The MWSD's are very good at bullying the majority of us so why dont they do the same to those that are 'swindling' the state out of Billions?

[ChillDoubt]

If memory serves, didn't vodafone avoid their bill by taking out the head of HMRC for a sumptuous lunch?

http://www.theguardian.com/money/2011/dec/06/hmrc-tax-deal-vodafone

One rule for them, a vastly different one for us.

[youngmafbog]

Well I suppose the monetary equivalent would be me buying my local tax officer a Mars bar.

Doubt I'd get much leniency on my tax bill for that though !!!

[Gromit]

The big boys have specialist tax accountants and will argue the toss with HMRC.

Small companies do not have the money or the time to fight HMRC so just pay up if they can.

[LazyGun]

heh. Its one thing identifying the problem, its quite another doing something about it. These multinationals have access to mechanisms not available to small and medium businesses, and many of the HMRCs tax advisors who frame the legislation subsequently go on to work for those self-same multinationals, or KPMG and the like, which is much the same thing.

And as Gromit points out, there does appear to have been an unduly cosy relationship between the then head of HMRC and Vodaphone.

Economists amongst you, please tell me what is wrong with this idea I saw floated the other day.

Rather than imposing a corporation tax on net profits, as is currently the case, why not remove corporation tax altogether, but add a very small amount in a kind of supplementary sales tax at the till?

That way, multinationals would act as the tax collectors for HMRC and would not be able to escape their contribution, based entirely upon their sales in that particular country? There would be no prospect of funnelling off funds or hiding profits then...

[youngmafbog]

True Gromit, but money should not be the deciding factor

Lazy, that works for Retail companies but not for all. VAT is already there if you want to get it at the till but of course the companies along the way claim it back.

I personally think we should have a much simpler tax system which would lead to easier prosecution meaning more pay meaning we can reduce the tax rates and so make it not worthwhile to avoid.

It has been done successfully.

[EDDIE51]

The problem is that the cleverest and best tax experts do not work for the inland revenue. They all work for large multinational company's who can pay many times more than Revenue can. The ones left to work for the government are those who are not clever enough to get a job in a large company. The top level accountants in the large company's will always be able to outwit the revenue who can only afford to employ the 'failures'.
If you were a top accountant would you work for the revenue if you could earn at

[EDDIE51]

Sorry hit submit too soon
If you could earn at least 10 x more by working for a multinational ?

[hc4361]

How many people would be thrown on the dole is big companies like Amazon bailed out of the UK altogether? That's the real worry.

[LazyGun]

@ymb I take your point, but even B2B companies without a retail network will have to bill their customers - so could they not just impose a notional supplementary tax at that point as well, and just do away with corporation tax altogether?

In my own business, I invoice as an external consultant. It would not be a hardship in processing terms to add a kind of supplementary, transaction tax onto those invoices, and would certainly reduce my accountancy fees, i think ;)

[Old_Geezer]

Small guys are easier to threaten. Go for the 'low hanging fruit'.

[bazwillrun]

Various reasons

big business rules the world

they know its very difficult to beat these people, time consuming, very expensive and no guaranteed outcome

Only real way is changes to the tax laws, but thats not going to happen in any big way anytime soon, last thing they want is to shoot themselves in the foot.

if what they are doing is legal then i'm afraid its suck it time,

who in their right mind pays more tax than they are legally obliged to...only a mug

[Old_Geezer]

One can simplify the national rules on tax as much as one likes, although that probably means more unfairness in the system since things are no longert tailored to situations. However these are multinational companies in a world the politicians have made easy to transfer money, labour, anything. If they don't get an unfairly beneficial deal in one place they move, either physically or using slight of hand on the paperwork, and carry on as before.

[ChillDoubt]

And as Gromit points out, there does appear to have been an unduly cosy relationship between the then head of HMRC and Vodaphone.
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Ahem!

[LazyGun]

@Chil :) Oops sorry - getting you and Gromit mixed up for some inexplicable reason...

[LazyGun]

If we were to do away with corporation tax and levy a supplementary tax on all transactions and invoices, they could not run away from their contributions. On the contrary, they would be collecting it for us. I am still struggling to understand why this would not be a good idea

[Peter Pedant]

.

But the general principle is, I regret, that we must pay the taxes that we owe whether or not Johnny-next-door pulls a fast one.

when i was arrested for drunk driving I wondered if the police didnt have something better to do
and of course they have ! They just dont like being shot at (I did not have a .... )

[ChillDoubt]

Oops sorry - getting you and Gromit mixed up for some inexplicable reason...
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I've never been so insulted! How very dare you!