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NHS vs. Red Cross - a humanitarian crisis?

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  • Anyone watching Hospital on bbc 2? It's highlighting just how stretched things are.
  • Talal said:

    Anyone watching Hospital on bbc 2? It's highlighting just how stretched things are.

    It would be nice to think Hunt et al are and feel suitably shamed about what they are doing to our health and social care systems.
  • edited January 11

    @SDAddick, you're a mench

    I am assuming you missed an s?
  • Does anyone consider that anyone who became the health secretary under the Conservative government would be demonised purely because its the NHS and Labour love pretending they own it?
  • @SDAddick, you're a mench

    I am assuming you missed an s?
    I prefer to spell it without the s in part to avoid connotations with a certain former MP
  • @SDAddick, you're a mench

    I am assuming you missed an s?
    I prefer to spell it without the s in part to avoid connotations with a certain former MP
    Louise Unmensch?
  • Fiiish said:

    Does anyone consider that anyone who became the health secretary under the Conservative government would be demonised purely because its the NHS and Labour love pretending they own it?

    As someone who voted Tory in 2015, I will quite happily admit that what they are doing in the Health Ministry is totally diabolical. As it is in several other areas of policy. Probably will never be voting for these tools ever again.
    You're stuck with Tim Farron's merrie men now. An uncomfortable stalemate
  • edited January 12

    Ah the politics of tax thread has migrated here. Right then...

    @cantersaddick I am surprised at you. Let me tell the problem with Google, Facebook, Amazon and Starbucks, and I think Apple, to name just the most well known ones. They are not paying corporation tax because they are on the fiddle As I've explained many times, they have persuaded the useless, underfunded HMRC of a preposterous fairy tale that they are 'concluding their business' in Ireland (or Luxembourg in Amazon's case.) Everyone in advertising knows this is ridiculous. Google and Facebook need all these people in the UK because that is where their clients are. They already have too many people in Ireland because they need to keep up the fantasy that their Euro head offices are there. Did you not see the TV doc where independent shopkeepers in a Welsh village banded together funds to "do a Google" with their tax arrangements?

    As for corporation tax not being important, well it was important enough for Dave Harkness, then head of HMRC to go to dinner with the boss of Vodafone to discuss the £8bn tax bill HMRC had landed them with, and after a very fine dinner, Mr Harkness let them off with about £1.5 bn, and Osborne called this a great deal. I think the NHS could use that missing £6,5bn, don't you?

    It's not about soaking the rich. It's about getting them, and rich corporations to pay the tax that Parliament intended when they passed the relevant legislation.

    @newyorkaddick , @cafcfan .

    Question for you, i am sure you both have the answers easily available. Could you please set out the top marginal tax rate including taxes which fund healthcare, for the following countries, please:

    UK
    Germany
    Sweden.

    And in the case of the latter two, could you present the evidence that the very rich in those countries have upped sticks en masse, or indulged in massive tax avoidance, per your rhetoric (other than the Swedish founder of Tetra-Pak, lurking in Sussex somewhere, and claiming his right to free entrance to UK museums)?.

    I argue that the British management class caught the US disease in the 80s of thinking private good, public bad, therefore I must avoid giving money to the government, they will only waste it. That attitude isn't so prevalent in Continental Europe. Maybe that's why many of them have higher marginal tax rates, and higher performing healthcare systems.

    @PragueAddick I'm not saying it is morally right. Quite the opposite. We all know it's ridiculous but at the same time it is legal.

    Until the governemnt close that loophole, which would involve some kind of international agreement with other countries (never going to happen because Luxembourg can make a killing from it), it will always go on. And the net benefit of having these companies operate here is still greater than not having them, even with the loss of corporation tax receipts.
  • Talal said:

    Anyone watching Hospital on bbc 2? It's highlighting just how stretched things are.

    I did and it was sickening to watch. Seeing surgeons getting very emotional was hard watching, as beds that they thought they had would be made unavailable at the last moment. One poor chap had his cancer operation cancelled at the last moment as an emergency admittant needed an op, or she would be dead in five hours. The NHS is broken, but it can be fixed.
    Will it be, I doubt it.
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  • Be patient (see what I did there?) we will soon be getting the £350million a week NHS Brexit bonus.
  • Apologies if this has been mentioned in previous pages (as not read through all the comments), but the NHS should not be treating people, who do not qualify; is the National Health Service and not the International one
  • seth plum said:

    Be patient (see what I did there?) we will soon be getting the £350million a week NHS Brexit bonus.

    Have to get someone to admit putting that figure out in the first place. All the prominent figures said at the time it was nothing to do with them. Hmmm.
  • Leuth said:

    Fiiish said:

    Does anyone consider that anyone who became the health secretary under the Conservative government would be demonised purely because its the NHS and Labour love pretending they own it?

    As someone who voted Tory in 2015, I will quite happily admit that what they are doing in the Health Ministry is totally diabolical. As it is in several other areas of policy. Probably will never be voting for these tools ever again.
    You're stuck with Tim Farron's merrie men now. An uncomfortable stalemate
    Ugh. Tim Farron would easily make my list of most unlikeable politicians. Really can't wait until they get someone less of a bed-wetting luvvie in the role.
  • Ah the politics of tax thread has migrated here. Right then...

    @cantersaddick I am surprised at you. Let me tell the problem with Google, Facebook, Amazon and Starbucks, and I think Apple, to name just the most well known ones. They are not paying corporation tax because they are on the fiddle As I've explained many times, they have persuaded the useless, underfunded HMRC of a preposterous fairy tale that they are 'concluding their business' in Ireland (or Luxembourg in Amazon's case.) Everyone in advertising knows this is ridiculous. Google and Facebook need all these people in the UK because that is where their clients are. They already have too many people in Ireland because they need to keep up the fantasy that their Euro head offices are there. Did you not see the TV doc where independent shopkeepers in a Welsh village banded together funds to "do a Google" with their tax arrangements?

    As for corporation tax not being important, well it was important enough for Dave Harkness, then head of HMRC to go to dinner with the boss of Vodafone to discuss the £8bn tax bill HMRC had landed them with, and after a very fine dinner, Mr Harkness let them off with about £1.5 bn, and Osborne called this a great deal. I think the NHS could use that missing £6,5bn, don't you?

    It's not about soaking the rich. It's about getting them, and rich corporations to pay the tax that Parliament intended when they passed the relevant legislation.

    @newyorkaddick , @cafcfan .

    Question for you, i am sure you both have the answers easily available. Could you please set out the top marginal tax rate including taxes which fund healthcare, for the following countries, please:

    UK
    Germany
    Sweden.

    And in the case of the latter two, could you present the evidence that the very rich in those countries have upped sticks en masse, or indulged in massive tax avoidance, per your rhetoric (other than the Swedish founder of Tetra-Pak, lurking in Sussex somewhere, and claiming his right to free entrance to UK museums)?.

    I argue that the British management class caught the US disease in the 80s of thinking private good, public bad, therefore I must avoid giving money to the government, they will only waste it. That attitude isn't so prevalent in Continental Europe. Maybe that's why many of them have higher marginal tax rates, and higher performing healthcare systems.

    @PragueAddick I'm not saying it is morally right. Quite the opposite. We all know it's ridiculous but at the same time it is legal.

    Until the governemnt close that loophole, which would involve some kind of international agreement with other countries (never going to happen because Luxembourg can make a killing from it), it will always go on. And the net benefit of having these companies operate here is still greater than not having them, even with the loss of corporation tax receipts.
    Sorry I can't let that go. What is the basis for your second remark I have highlighted? Forgive me if I am wrong, but I think that sounds like a Tory politician's soundbite that you have picked up and believed.

    I think it is worth reminding everyone what is going on with Google and Facebook. They like to say they are "tech companies". That's bullshit. They are media owners, like the ITV companies or News Corp or whoever owns the News Shopper. That is how they make their billions.

    Now, imagine you are the UK brand manager on, say Magnum ice cream. Your ad agency recommends you big TV campaigns for the year.It books the campaigns on Unilever's behalf. ITV invoices your agency, and I am pretty sure there is VAT on advertising. The profits from those activities are declared in the UK, and the VAT raised is UK VAT.

    However increasingly the use of social media campaigns means a lot of the budget that used to go to ITV is now being eaten up by Google and Facebook. The people that made that happen are sitting in those companies' respective offices in Kings Cross, and in many cases they can walk to the meeting with the ad agencies. That s what those people there at Google do. What else do you think they do? Design driverless cars? However when the invoice comes in it comes from Dublin. Corp tax, suitably massaged down through the web of Irish companies, is paid to the Irish government. And I am pretty sure it will have Irish VAT on it. So no UK corp or VAT paid, despite the fact that all the people involved are based in the UK and the transaction was in support of a UK advertising campaign.

    Legal, you say? Well in that case, try it yourself. Lets say you set up as a consultant and create a Ltd co.. Let's imagine you have a relative in Dublin. So you also set up a Ltd co in Ireland. You do all your work in London, with UK based clients, but you invoice a load of them from Ireland, with only a bit going through your UK company which neverthless is UK registered so you can reclaim VAT on computers etc. What do you think HMRC will say when they find out? They will take you to the cleaners because you obviously are doing business in the UK, never mind the invoice.

    So how do Google and Facebook get away with it? Two reasons. One, they have set up a far more complex web of companies to muddy the waters, and two they have muddied the waters about what exactly they do as a business. And HMRC, being understaffed and underpowered, are bewildered and dare not take them on. There is a difference between being legal, and not having been legally challenged.

    Now, please tell me what benefits those guys bring which outweigh the costs. The costs run to billions for sure, so they will need to be pretty big benefits.
  • edited January 12

    Ah the politics of tax thread has migrated here. Right then...

    @cantersaddick I am surprised at you. Let me tell the problem with Google, Facebook, Amazon and Starbucks, and I think Apple, to name just the most well known ones. They are not paying corporation tax because they are on the fiddle As I've explained many times, they have persuaded the useless, underfunded HMRC of a preposterous fairy tale that they are 'concluding their business' in Ireland (or Luxembourg in Amazon's case.) Everyone in advertising knows this is ridiculous. Google and Facebook need all these people in the UK because that is where their clients are. They already have too many people in Ireland because they need to keep up the fantasy that their Euro head offices are there. Did you not see the TV doc where independent shopkeepers in a Welsh village banded together funds to "do a Google" with their tax arrangements?

    As for corporation tax not being important, well it was important enough for Dave Harkness, then head of HMRC to go to dinner with the boss of Vodafone to discuss the £8bn tax bill HMRC had landed them with, and after a very fine dinner, Mr Harkness let them off with about £1.5 bn, and Osborne called this a great deal. I think the NHS could use that missing £6,5bn, don't you?

    It's not about soaking the rich. It's about getting them, and rich corporations to pay the tax that Parliament intended when they passed the relevant legislation.

    @newyorkaddick , @cafcfan .

    Question for you, i am sure you both have the answers easily available. Could you please set out the top marginal tax rate including taxes which fund healthcare, for the following countries, please:

    UK
    Germany
    Sweden.

    And in the case of the latter two, could you present the evidence that the very rich in those countries have upped sticks en masse, or indulged in massive tax avoidance, per your rhetoric (other than the Swedish founder of Tetra-Pak, lurking in Sussex somewhere, and claiming his right to free entrance to UK museums)?.

    I argue that the British management class caught the US disease in the 80s of thinking private good, public bad, therefore I must avoid giving money to the government, they will only waste it. That attitude isn't so prevalent in Continental Europe. Maybe that's why many of them have higher marginal tax rates, and higher performing healthcare systems.

    @PragueAddick I assume German/Swedish top rate tax is higher else you wouldn't be asking the question - however I'd be very surprised in the case of Germany if the overall tax burden is materially different from the UKs (when all taxes are included). Indeed total fiscal spending as a % of GDP is the same in the UK versus Germany so the money must come from somewhere (notwithstanding our budget deficit!).

    With regard to tax avoidance, the key difference between Germany and the UK is that a very high proportion of our highest taxpayers (I would guess a majority) are not UK citizens, or at least were not born here.

    For various historical reasons the drivers of the two economies are clearly completely different, with our key world class industries being magnets for high paid foreign talent who can just as easily up sticks and work elsewhere (hence the Laffer Curve kicking in at relatively low levels in the UK). This is clearly not true at BMW, Siemens, BASF etc. I'm not saying which is right or wrong, but just that they're different.

    The Scandinavian countries have always had a different social contract from the rest of the West but I'd argue it is much easier to manage with relatively small populations.
  • @newyorkaddick .

    Hmm

    Ok, basic table here.

    Germany 47.5% Health insurance, choice of companies, rate fixed by State, 15%
    Sweden 59.7%, cannot get a figure for health insurance alone, but total payroll deductions are given as 31.2%.

    I suppose when you say The Scandinavian countries have always had a different social contract from the rest of the West I would suggest that in fact the difference is more with US and UK attitudes, as Sweden and Denmark especially have moved closer to W. Europe. Tax and restrictions on alcohol in Sweden are not much different to Germany now. Norway is a different matter.
  • IAIA
    edited January 12
    ..
  • Ah the politics of tax thread has migrated here. Right then...

    @cantersaddick I am surprised at you. Let me tell the problem with Google, Facebook, Amazon and Starbucks, and I think Apple, to name just the most well known ones. They are not paying corporation tax because they are on the fiddle As I've explained many times, they have persuaded the useless, underfunded HMRC of a preposterous fairy tale that they are 'concluding their business' in Ireland (or Luxembourg in Amazon's case.) Everyone in advertising knows this is ridiculous. Google and Facebook need all these people in the UK because that is where their clients are. They already have too many people in Ireland because they need to keep up the fantasy that their Euro head offices are there. Did you not see the TV doc where independent shopkeepers in a Welsh village banded together funds to "do a Google" with their tax arrangements?

    As for corporation tax not being important, well it was important enough for Dave Harkness, then head of HMRC to go to dinner with the boss of Vodafone to discuss the £8bn tax bill HMRC had landed them with, and after a very fine dinner, Mr Harkness let them off with about £1.5 bn, and Osborne called this a great deal. I think the NHS could use that missing £6,5bn, don't you?

    It's not about soaking the rich. It's about getting them, and rich corporations to pay the tax that Parliament intended when they passed the relevant legislation.

    @newyorkaddick , @cafcfan .

    Question for you, i am sure you both have the answers easily available. Could you please set out the top marginal tax rate including taxes which fund healthcare, for the following countries, please:

    UK
    Germany
    Sweden.

    And in the case of the latter two, could you present the evidence that the very rich in those countries have upped sticks en masse, or indulged in massive tax avoidance, per your rhetoric (other than the Swedish founder of Tetra-Pak, lurking in Sussex somewhere, and claiming his right to free entrance to UK museums)?.

    I argue that the British management class caught the US disease in the 80s of thinking private good, public bad, therefore I must avoid giving money to the government, they will only waste it. That attitude isn't so prevalent in Continental Europe. Maybe that's why many of them have higher marginal tax rates, and higher performing healthcare systems.

    @PragueAddick I'm not saying it is morally right. Quite the opposite. We all know it's ridiculous but at the same time it is legal.

    Until the governemnt close that loophole, which would involve some kind of international agreement with other countries (never going to happen because Luxembourg can make a killing from it), it will always go on. And the net benefit of having these companies operate here is still greater than not having them, even with the loss of corporation tax receipts.
    Sorry I can't let that go. What is the basis for your second remark I have highlighted? Forgive me if I am wrong, but I think that sounds like a Tory politician's soundbite that you have picked up and believed.

    I think it is worth reminding everyone what is going on with Google and Facebook. They like to say they are "tech companies". That's bullshit. They are media owners, like the ITV companies or News Corp or whoever owns the News Shopper. That is how they make their billions.

    Now, imagine you are the UK brand manager on, say Magnum ice cream. Your ad agency recommends you big TV campaigns for the year.It books the campaigns on Unilever's behalf. ITV invoices your agency, and I am pretty sure there is VAT on advertising. The profits from those activities are declared in the UK, and the VAT raised is UK VAT.

    However increasingly the use of social media campaigns means a lot of the budget that used to go to ITV is now being eaten up by Google and Facebook. The people that made that happen are sitting in those companies' respective offices in Kings Cross, and in many cases they can walk to the meeting with the ad agencies. That s what those people there at Google do. What else do you think they do? Design driverless cars? However when the invoice comes in it comes from Dublin. Corp tax, suitably massaged down through the web of Irish companies, is paid to the Irish government. And I am pretty sure it will have Irish VAT on it. So no UK corp or VAT paid, despite the fact that all the people involved are based in the UK and the transaction was in support of a UK advertising campaign.

    Legal, you say? Well in that case, try it yourself. Lets say you set up as a consultant and create a Ltd co.. Let's imagine you have a relative in Dublin. So you also set up a Ltd co in Ireland. You do all your work in London, with UK based clients, but you invoice a load of them from Ireland, with only a bit going through your UK company which neverthless is UK registered so you can reclaim VAT on computers etc. What do you think HMRC will say when they find out? They will take you to the cleaners because you obviously are doing business in the UK, never mind the invoice.

    So how do Google and Facebook get away with it? Two reasons. One, they have set up a far more complex web of companies to muddy the waters, and two they have muddied the waters about what exactly they do as a business. And HMRC, being understaffed and underpowered, are bewildered and dare not take them on. There is a difference between being legal, and not having been legally challenged.

    Now, please tell me what benefits those guys bring which outweigh the costs. The costs run to billions for sure, so they will need to be pretty big benefits.
    Just to use Facebook as an example (and quoting from their latest UK audited financial statements for 2015), they generated £211m of revenues but lost £53m (hence no corporation tax was due obviously).

    However importantly they paid their 682 people £78m in wages/salaries (on which PAYE was collected) and £13m in social security costs (ie. NI) - they also issued substantial share options which will obviously generate tax if/when exercised.

    So in short an extraordinary company founded outside the UK and which didn't exist until 2004 now employs hundreds of highly paid professionals, generating tens of millions of pounds for HMRC via PAYE/NI alone.

    In the meantime they are hiring 500 more staff in the UK....
  • @newyorkaddick .

    Hmm

    Ok, basic table here.

    Germany 47.5% Health insurance, choice of companies, rate fixed by State, 15%
    Sweden 59.7%, cannot get a figure for health insurance alone, but total payroll deductions are given as 31.2%.

    I suppose when you say The Scandinavian countries have always had a different social contract from the rest of the West I would suggest that in fact the difference is more with US and UK attitudes, as Sweden and Denmark especially have moved closer to W. Europe. Tax and restrictions on alcohol in Sweden are not much different to Germany now. Norway is a different matter.

    Maybe so, but Western Europe is in a complete economic mess (with worse surely to follow) - is this really a model we should be aspiring to?
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  • @PragueAddick I'm not saying it is morally right. Quite the opposite. We all know it's ridiculous but at the same time it is legal.

    Until the governemnt close that loophole, which would involve some kind of international agreement with other countries (never going to happen because Luxembourg can make a killing from it), it will always go on. And the net benefit of having these companies operate here is still greater than not having them, even with the loss of corporation tax receipts.


    Apologies if I am being woefully naive here but, If those companies left wouldn't the market correct itself and other organisations offering similar services would take their place?
  • @newyorkaddick .

    Hmm

    Ok, basic table here.

    Germany 47.5% Health insurance, choice of companies, rate fixed by State, 15%
    Sweden 59.7%, cannot get a figure for health insurance alone, but total payroll deductions are given as 31.2%.

    I suppose when you say The Scandinavian countries have always had a different social contract from the rest of the West I would suggest that in fact the difference is more with US and UK attitudes, as Sweden and Denmark especially have moved closer to W. Europe. Tax and restrictions on alcohol in Sweden are not much different to Germany now. Norway is a different matter.

    Maybe so, but Western Europe is in a complete economic mess (with worse surely to follow) - is this really a model we should be aspiring to?
    I think if you compare conditions today in QE Woolwich with an equivalent hospital in Paris or Berlin, it may offer a challenge to the conclusion you are ready to draw. My (Czech) niece works asa junior doctor in small town Eastern Germany, so I know something of what I speak.

    Overall, and as a general point let me put this to you. Since the 80s Britain has leaned towards the US model of red in tooth and claw capitalism, whereas Western Europe has been far more cautious. However, the NHS is the ultimate socialist style approach to national healthcare in the developed world, and the population, including many right leaning voters, are convinced the model is superior to others, certainly to the US system. That's why I am banging on about tax. We are schizophrenic about what type of society we want to build.
  • Ah the politics of tax thread has migrated here. Right then...

    @cantersaddick I am surprised at you. Let me tell the problem with Google, Facebook, Amazon and Starbucks, and I think Apple, to name just the most well known ones. They are not paying corporation tax because they are on the fiddle As I've explained many times, they have persuaded the useless, underfunded HMRC of a preposterous fairy tale that they are 'concluding their business' in Ireland (or Luxembourg in Amazon's case.) Everyone in advertising knows this is ridiculous. Google and Facebook need all these people in the UK because that is where their clients are. They already have too many people in Ireland because they need to keep up the fantasy that their Euro head offices are there. Did you not see the TV doc where independent shopkeepers in a Welsh village banded together funds to "do a Google" with their tax arrangements?

    As for corporation tax not being important, well it was important enough for Dave Harkness, then head of HMRC to go to dinner with the boss of Vodafone to discuss the £8bn tax bill HMRC had landed them with, and after a very fine dinner, Mr Harkness let them off with about £1.5 bn, and Osborne called this a great deal. I think the NHS could use that missing £6,5bn, don't you?

    It's not about soaking the rich. It's about getting them, and rich corporations to pay the tax that Parliament intended when they passed the relevant legislation.

    @newyorkaddick , @cafcfan .

    Question for you, i am sure you both have the answers easily available. Could you please set out the top marginal tax rate including taxes which fund healthcare, for the following countries, please:

    UK
    Germany
    Sweden.

    And in the case of the latter two, could you present the evidence that the very rich in those countries have upped sticks en masse, or indulged in massive tax avoidance, per your rhetoric (other than the Swedish founder of Tetra-Pak, lurking in Sussex somewhere, and claiming his right to free entrance to UK museums)?.

    I argue that the British management class caught the US disease in the 80s of thinking private good, public bad, therefore I must avoid giving money to the government, they will only waste it. That attitude isn't so prevalent in Continental Europe. Maybe that's why many of them have higher marginal tax rates, and higher performing healthcare systems.

    @PragueAddick I'm not saying it is morally right. Quite the opposite. We all know it's ridiculous but at the same time it is legal.

    Until the governemnt close that loophole, which would involve some kind of international agreement with other countries (never going to happen because Luxembourg can make a killing from it), it will always go on. And the net benefit of having these companies operate here is still greater than not having them, even with the loss of corporation tax receipts.
    Sorry I can't let that go. What is the basis for your second remark I have highlighted? Forgive me if I am wrong, but I think that sounds like a Tory politician's soundbite that you have picked up and believed.

    I think it is worth reminding everyone what is going on with Google and Facebook. They like to say they are "tech companies". That's bullshit. They are media owners, like the ITV companies or News Corp or whoever owns the News Shopper. That is how they make their billions.

    Now, imagine you are the UK brand manager on, say Magnum ice cream. Your ad agency recommends you big TV campaigns for the year.It books the campaigns on Unilever's behalf. ITV invoices your agency, and I am pretty sure there is VAT on advertising. The profits from those activities are declared in the UK, and the VAT raised is UK VAT.

    However increasingly the use of social media campaigns means a lot of the budget that used to go to ITV is now being eaten up by Google and Facebook. The people that made that happen are sitting in those companies' respective offices in Kings Cross, and in many cases they can walk to the meeting with the ad agencies. That s what those people there at Google do. What else do you think they do? Design driverless cars? However when the invoice comes in it comes from Dublin. Corp tax, suitably massaged down through the web of Irish companies, is paid to the Irish government. And I am pretty sure it will have Irish VAT on it. So no UK corp or VAT paid, despite the fact that all the people involved are based in the UK and the transaction was in support of a UK advertising campaign.

    Legal, you say? Well in that case, try it yourself. Lets say you set up as a consultant and create a Ltd co.. Let's imagine you have a relative in Dublin. So you also set up a Ltd co in Ireland. You do all your work in London, with UK based clients, but you invoice a load of them from Ireland, with only a bit going through your UK company which neverthless is UK registered so you can reclaim VAT on computers etc. What do you think HMRC will say when they find out? They will take you to the cleaners because you obviously are doing business in the UK, never mind the invoice.

    So how do Google and Facebook get away with it? Two reasons. One, they have set up a far more complex web of companies to muddy the waters, and two they have muddied the waters about what exactly they do as a business. And HMRC, being understaffed and underpowered, are bewildered and dare not take them on. There is a difference between being legal, and not having been legally challenged.

    Now, please tell me what benefits those guys bring which outweigh the costs. The costs run to billions for sure, so they will need to be pretty big benefits.
    Just to use Facebook as an example (and quoting from their latest UK audited financial statements for 2015), they generated £211m of revenues but lost £53m (hence no corporation tax was due obviously).

    However importantly they paid their 682 people £78m in wages/salaries (on which PAYE was collected) and £13m in social security costs (ie. NI) - they also issued substantial share options which will obviously generate tax if/when exercised.

    So in short an extraordinary company founded outside the UK and which didn't exist until 2004 now employs hundreds of highly paid professionals, generating tens of millions of pounds for HMRC via PAYE/NI alone.

    In the meantime they are hiring 500 more staff in the UK....
    The idea that Facebook really only made £211m in revenue from their sales activities targetting people in the UK, is utterly laughable and part of the grand fairy tale. In the same year, UK adspend on digital media hit a record £8.6bn

    You see the problem now?

  • Ah the politics of tax thread has migrated here. Right then...

    @cantersaddick I am surprised at you. Let me tell the problem with Google, Facebook, Amazon and Starbucks, and I think Apple, to name just the most well known ones. They are not paying corporation tax because they are on the fiddle As I've explained many times, they have persuaded the useless, underfunded HMRC of a preposterous fairy tale that they are 'concluding their business' in Ireland (or Luxembourg in Amazon's case.) Everyone in advertising knows this is ridiculous. Google and Facebook need all these people in the UK because that is where their clients are. They already have too many people in Ireland because they need to keep up the fantasy that their Euro head offices are there. Did you not see the TV doc where independent shopkeepers in a Welsh village banded together funds to "do a Google" with their tax arrangements?

    As for corporation tax not being important, well it was important enough for Dave Harkness, then head of HMRC to go to dinner with the boss of Vodafone to discuss the £8bn tax bill HMRC had landed them with, and after a very fine dinner, Mr Harkness let them off with about £1.5 bn, and Osborne called this a great deal. I think the NHS could use that missing £6,5bn, don't you?

    It's not about soaking the rich. It's about getting them, and rich corporations to pay the tax that Parliament intended when they passed the relevant legislation.

    @newyorkaddick , @cafcfan .

    Question for you, i am sure you both have the answers easily available. Could you please set out the top marginal tax rate including taxes which fund healthcare, for the following countries, please:

    UK
    Germany
    Sweden.

    And in the case of the latter two, could you present the evidence that the very rich in those countries have upped sticks en masse, or indulged in massive tax avoidance, per your rhetoric (other than the Swedish founder of Tetra-Pak, lurking in Sussex somewhere, and claiming his right to free entrance to UK museums)?.

    I argue that the British management class caught the US disease in the 80s of thinking private good, public bad, therefore I must avoid giving money to the government, they will only waste it. That attitude isn't so prevalent in Continental Europe. Maybe that's why many of them have higher marginal tax rates, and higher performing healthcare systems.

    @PragueAddick I'm not saying it is morally right. Quite the opposite. We all know it's ridiculous but at the same time it is legal.

    Until the governemnt close that loophole, which would involve some kind of international agreement with other countries (never going to happen because Luxembourg can make a killing from it), it will always go on. And the net benefit of having these companies operate here is still greater than not having them, even with the loss of corporation tax receipts.
    Sorry I can't let that go. What is the basis for your second remark I have highlighted? Forgive me if I am wrong, but I think that sounds like a Tory politician's soundbite that you have picked up and believed.

    I think it is worth reminding everyone what is going on with Google and Facebook. They like to say they are "tech companies". That's bullshit. They are media owners, like the ITV companies or News Corp or whoever owns the News Shopper. That is how they make their billions.

    Now, imagine you are the UK brand manager on, say Magnum ice cream. Your ad agency recommends you big TV campaigns for the year.It books the campaigns on Unilever's behalf. ITV invoices your agency, and I am pretty sure there is VAT on advertising. The profits from those activities are declared in the UK, and the VAT raised is UK VAT.

    However increasingly the use of social media campaigns means a lot of the budget that used to go to ITV is now being eaten up by Google and Facebook. The people that made that happen are sitting in those companies' respective offices in Kings Cross, and in many cases they can walk to the meeting with the ad agencies. That s what those people there at Google do. What else do you think they do? Design driverless cars? However when the invoice comes in it comes from Dublin. Corp tax, suitably massaged down through the web of Irish companies, is paid to the Irish government. And I am pretty sure it will have Irish VAT on it. So no UK corp or VAT paid, despite the fact that all the people involved are based in the UK and the transaction was in support of a UK advertising campaign.

    Legal, you say? Well in that case, try it yourself. Lets say you set up as a consultant and create a Ltd co.. Let's imagine you have a relative in Dublin. So you also set up a Ltd co in Ireland. You do all your work in London, with UK based clients, but you invoice a load of them from Ireland, with only a bit going through your UK company which neverthless is UK registered so you can reclaim VAT on computers etc. What do you think HMRC will say when they find out? They will take you to the cleaners because you obviously are doing business in the UK, never mind the invoice.

    So how do Google and Facebook get away with it? Two reasons. One, they have set up a far more complex web of companies to muddy the waters, and two they have muddied the waters about what exactly they do as a business. And HMRC, being understaffed and underpowered, are bewildered and dare not take them on. There is a difference between being legal, and not having been legally challenged.

    Now, please tell me what benefits those guys bring which outweigh the costs. The costs run to billions for sure, so they will need to be pretty big benefits.
    Just to use Facebook as an example (and quoting from their latest UK audited financial statements for 2015), they generated £211m of revenues but lost £53m (hence no corporation tax was due obviously).

    However importantly they paid their 682 people £78m in wages/salaries (on which PAYE was collected) and £13m in social security costs (ie. NI) - they also issued substantial share options which will obviously generate tax if/when exercised.

    So in short an extraordinary company founded outside the UK and which didn't exist until 2004 now employs hundreds of highly paid professionals, generating tens of millions of pounds for HMRC via PAYE/NI alone.

    In the meantime they are hiring 500 more staff in the UK....
    The idea that Facebook really only made £211m in revenue from their sales activities targetting people in the UK, is utterly laughable and part of the grand fairy tale. In the same year, UK adspend on digital media hit a record £8.6bn

    You see the problem now?

    Whatever they have done, HMRC have blessed as legal (perhaps because they recognise that the alternative [eg. Facebook moving 1,500 highly-paid skilled staff somewhere else] is worse).
  • edited January 12
    @newyorkaddick


    Whatever they have done, HMRC have blessed as legal (perhaps because they recognise that the alternative [eg. Facebook moving 1,500 highly-paid skilled staff somewhere else] is worse).

    Oh come on, now you are sticking your head in the sand. Disappointing from you. Let me tell you about those 1500 people

    1. They are mainly sales and marketing people serving the UK market, albeit with some overlap into Continental Europe. Unless they are there in the UK Facebook sales will suffer.

    2. They are smart and talented people who will be snapped up in a nano-second by other media owners, ad agencies or marketing depts of corporates. Who pay UK corporate tax. They will suffer a pay cut because Google and FB pay eye watering salaries (which create a convenient P&L loss), but they won't go hungry.

    HMRC haven't got a scooby what's going on here, they are not fit for purpose in the digital world, and of course Osborne reduced their headcount by 40% did he not?

    Oh and I will tell you what else Facebook and Google hire. PR people. I mean, really high level ones, who know how to talk to and influence government officials. Again I know of what I speak. Czech Google 5 years ago hired the woman who is acknowledged as far and away the single most talented PR person the country has produced since the revolution. She's a friend, but she has been giving me a wide berth since I wrote a blogpost on the tax subject :-)


  • Whatever they have done, HMRC have blessed as legal (perhaps because they recognise that the alternative [eg. Facebook moving 1,500 highly-paid skilled staff somewhere else] is worse).

    Oh come on, now you are sticking your head in the sand. Disappointing from you. Let me tell you about those 1500 people

    1. They are mainly sales and marketing people serving the UK market, albeit with some overlap into Continental Europe. Unless they are there in the UK Facebook sales will suffer.

    2. They are smart and talented people who will be snapped up in a nano-second by other media owners, ad agencies or marketing depts of corporates. Who pay UK corporate tax. They will suffer a pay cut because Google and FB pay eye watering salaries (which create a convenient P&L loss), but they won't go hungry.

    HMRC haven't got a scooby what's going on here, they are not fit for purpose in the digital world, and of course Osborne reduced their headcount by 40% did he not?

    Oh and I will tell you what else Facebook and Google hire. PR people. I mean, really high level ones, who know how to talk to and influence government officials. Again I know of what I speak. Czech Google 5 years ago hired the woman who is acknowledged as far and away the single most talented PR person the country has produced since the revolution. She's a friend, but she has been giving me a wide berth since I wrote a blogpost on the tax subject :-)




    Either way corporation tax is not an especially important generator of revenues in the greater scheme of things, representing less than 10% of receipts. It's also been remarkably stable overall around £45-50bn pa with the exception understandably of the financial crisis, which runs against the idea that corporations are running rings around HMRC (at least as a whole, albeit perhaps individually).
  • Ah the politics of tax thread has migrated here. Right then...

    @cantersaddick I am surprised at you. Let me tell the problem with Google, Facebook, Amazon and Starbucks, and I think Apple, to name just the most well known ones. They are not paying corporation tax because they are on the fiddle As I've explained many times, they have persuaded the useless, underfunded HMRC of a preposterous fairy tale that they are 'concluding their business' in Ireland (or Luxembourg in Amazon's case.) Everyone in advertising knows this is ridiculous. Google and Facebook need all these people in the UK because that is where their clients are. They already have too many people in Ireland because they need to keep up the fantasy that their Euro head offices are there. Did you not see the TV doc where independent shopkeepers in a Welsh village banded together funds to "do a Google" with their tax arrangements?

    As for corporation tax not being important, well it was important enough for Dave Harkness, then head of HMRC to go to dinner with the boss of Vodafone to discuss the £8bn tax bill HMRC had landed them with, and after a very fine dinner, Mr Harkness let them off with about £1.5 bn, and Osborne called this a great deal. I think the NHS could use that missing £6,5bn, don't you?

    It's not about soaking the rich. It's about getting them, and rich corporations to pay the tax that Parliament intended when they passed the relevant legislation.

    @newyorkaddick , @cafcfan .

    Question for you, i am sure you both have the answers easily available. Could you please set out the top marginal tax rate including taxes which fund healthcare, for the following countries, please:

    UK
    Germany
    Sweden.

    And in the case of the latter two, could you present the evidence that the very rich in those countries have upped sticks en masse, or indulged in massive tax avoidance, per your rhetoric (other than the Swedish founder of Tetra-Pak, lurking in Sussex somewhere, and claiming his right to free entrance to UK museums)?.

    I argue that the British management class caught the US disease in the 80s of thinking private good, public bad, therefore I must avoid giving money to the government, they will only waste it. That attitude isn't so prevalent in Continental Europe. Maybe that's why many of them have higher marginal tax rates, and higher performing healthcare systems.

    @PragueAddick I'm not saying it is morally right. Quite the opposite. We all know it's ridiculous but at the same time it is legal.

    Until the governemnt close that loophole, which would involve some kind of international agreement with other countries (never going to happen because Luxembourg can make a killing from it), it will always go on. And the net benefit of having these companies operate here is still greater than not having them, even with the loss of corporation tax receipts.
    Sorry I can't let that go. What is the basis for your second remark I have highlighted? Forgive me if I am wrong, but I think that sounds like a Tory politician's soundbite that you have picked up and believed.

    I think it is worth reminding everyone what is going on with Google and Facebook. They like to say they are "tech companies". That's bullshit. They are media owners, like the ITV companies or News Corp or whoever owns the News Shopper. That is how they make their billions.

    Now, imagine you are the UK brand manager on, say Magnum ice cream. Your ad agency recommends you big TV campaigns for the year.It books the campaigns on Unilever's behalf. ITV invoices your agency, and I am pretty sure there is VAT on advertising. The profits from those activities are declared in the UK, and the VAT raised is UK VAT.

    However increasingly the use of social media campaigns means a lot of the budget that used to go to ITV is now being eaten up by Google and Facebook. The people that made that happen are sitting in those companies' respective offices in Kings Cross, and in many cases they can walk to the meeting with the ad agencies. That s what those people there at Google do. What else do you think they do? Design driverless cars? However when the invoice comes in it comes from Dublin. Corp tax, suitably massaged down through the web of Irish companies, is paid to the Irish government. And I am pretty sure it will have Irish VAT on it. So no UK corp or VAT paid, despite the fact that all the people involved are based in the UK and the transaction was in support of a UK advertising campaign.

    Legal, you say? Well in that case, try it yourself. Lets say you set up as a consultant and create a Ltd co.. Let's imagine you have a relative in Dublin. So you also set up a Ltd co in Ireland. You do all your work in London, with UK based clients, but you invoice a load of them from Ireland, with only a bit going through your UK company which neverthless is UK registered so you can reclaim VAT on computers etc. What do you think HMRC will say when they find out? They will take you to the cleaners because you obviously are doing business in the UK, never mind the invoice.

    So how do Google and Facebook get away with it? Two reasons. One, they have set up a far more complex web of companies to muddy the waters, and two they have muddied the waters about what exactly they do as a business. And HMRC, being understaffed and underpowered, are bewildered and dare not take them on. There is a difference between being legal, and not having been legally challenged.

    Now, please tell me what benefits those guys bring which outweigh the costs. The costs run to billions for sure, so they will need to be pretty big benefits.
    Just to use Facebook as an example (and quoting from their latest UK audited financial statements for 2015), they generated £211m of revenues but lost £53m (hence no corporation tax was due obviously).

    However importantly they paid their 682 people £78m in wages/salaries (on which PAYE was collected) and £13m in social security costs (ie. NI) - they also issued substantial share options which will obviously generate tax if/when exercised.

    So in short an extraordinary company founded outside the UK and which didn't exist until 2004 now employs hundreds of highly paid professionals, generating tens of millions of pounds for HMRC via PAYE/NI alone.

    In the meantime they are hiring 500 more staff in the UK....
    The idea that Facebook really only made £211m in revenue from their sales activities targetting people in the UK, is utterly laughable and part of the grand fairy tale. In the same year, UK adspend on digital media hit a record £8.6bn

    You see the problem now?

    Whatever they have done, HMRC have blessed as legal (perhaps because they recognise that the alternative [eg. Facebook moving 1,500 highly-paid skilled staff somewhere else] is worse).
    As have their Auditors.
  • edited January 12



    Either way corporation tax is not an especially important generator of revenues in the greater scheme of things, representing less than 10% of receipts. It's also been remarkably stable overall around £45-50bn pa with the exception understandably of the financial crisis, which runs against the idea that corporations are running rings around HMRC (at least as a whole, albeit perhaps individually).

    Stable, eh? Shouldn't it be growing, in line with the dynamic UK economy? Isn't that one of the key reasons to encourage growth?

    As a matter of interest, what are the biggest components of tax receipts?

  • Whatever they have done, HMRC have blessed as legal (perhaps because they recognise that the alternative [eg. Facebook moving 1,500 highly-paid skilled staff somewhere else] is worse).
    Oh come on, now you are sticking your head in the sand. Disappointing from you. Let me tell you about those 1500 people

    1. They are mainly sales and marketing people serving the UK market, albeit with some overlap into Continental Europe. Unless they are there in the UK Facebook sales will suffer.

    2. They are smart and talented people who will be snapped up in a nano-second by other media owners, ad agencies or marketing depts of corporates. Who pay UK corporate tax. They will suffer a pay cut because Google and FB pay eye watering salaries (which create a convenient P&L loss), but they won't go hungry.

    HMRC haven't got a scooby what's going on here, they are not fit for purpose in the digital world, and of course Osborne reduced their headcount by 40% did he not?

    Oh and I will tell you what else Facebook and Google hire. PR people. I mean, really high level ones, who know how to talk to and influence government officials. Again I know of what I speak. Czech Google 5 years ago hired the woman who is acknowledged as far and away the single most talented PR person the country has produced since the revolution. She's a friend, but she has been giving me a wide berth since I wrote a blogpost on the tax subject :-)


    Either way corporation tax is not an especially important generator of revenues in the greater scheme of things, representing less than 10% of receipts. It's also been remarkably stable overall around £45-50bn pa with the exception understandably of the financial crisis, which runs against the idea that corporations are running rings around HMRC (at least as a whole, albeit perhaps individually).

    Stable, eh? Shouldn't it be growing, in line with the dynamic UK economy? Isn't that one of the key reasons to encourage growth?

    As a matter of interest, what are the biggest components of tax receipts?



    The fastest-growing companies typically don't make any money...

    In 2015/16, HMRC revenues of £534bn including the following:

    - Income tax £168bn (of which PAYE £145bn);
    - Capital gains tax £7bn
    - National Insurance £114bn
    - VAT £115bn
    - Corporation tax £44bn
    - Fuel duty £28bn
    - Inheritance tax £5bn
    - Land stamp duty £11bn
    - Tobacco duty £9bn
    - Alcohol duty £10bn

    It's noticeable how immaterial CGT and IHT is (yet the latter is so politically charged).

    I find land stamp duty to be an especially pointless tax (the only one that is true 'dead money') with unintended consequences - removing it would lead to a flood of homes onto the market, reducing prices and helping struggling young buyers. The lost revenue could be replaced by a 2% increase in VAT.


  • @newyorkaddick

    Thanks for the breakdown, very interesting. So although CIT is in fact only 8% of the mix, there is no one overriding component. PIT is 31%.

    There again, let's use this article to guesstimate Google and Facebook's real UK revenue; Google 3.1billion, and Facebook 1.12billion. I reckon that if I use the PBT of a healthy ad agency of 25% as a benchmark, I am being generous to those two, but that gives PBT for Google of 775m and Facebook of 280m. So an extra billion plus a year just from those two companies. Don't tell me that isn't worth having.
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