I must say, I don't recall anyone needing to 'teach' me to use a phone.

Well thats not the same thing as I'm talking about.

Well perhaps that was too much of a generalisation to make a point in that you can still avoid corporation tax and be HQ'd here as well if you have operations abroad. Things like transfer pricing work wherever you are HQ'd. Boots have an operational HQ in Nottingham but the parent company is Swiss. Remember the controversy over Vodafone and its tax deal with HMRC?

In any case it is not just "UK" companies who are avoiding tax. Ikea for example does it, we know Starbucks has done it and so on.

This tax avoidance is a serious problem and while even Amazon pay a small amount of corporation tax the amount they pay is minimised by being incorporated in Ireland.

The idea any of these companies will give up their tax avoidance schemes because we lower our corporation tax rate is as I said naive.



I think you underestimate the political skill of Alex Salmond. The "better together" campaign is being painted as negative and while I think Salmond and the SNP are living in cloud cuckoo land with half the stuff they are promising this bad news on supermarket pricing is thrown back as bullying and a way to point out just why they need to be free of such parasites. I have been following the debate on various on-line sites and whenever anything negative comes up if they can't refute it outright the tactic is to try and frame the debate along the lines of "well we might be worse off but at least we will be in charge of our own destiny". This is going to be as much about the heart as the mind and while polls show a minority in favour of independence there are enough undecided voters to swing it and it is these Salmond and the SNP are targeting with their "Braveheart" tactics.

It is ironic you chose BP as an example. They oppose one of the fundamental accounting reforms that would permit the correct level of corporation tax to be paid. Country-by-country reporting.

Why do you think they oppose it? Because corporation tax rate is too high?

No, because being able to post consolidated accounts that hide intra-group trades is a key way of avoiding the tax and they will want to keep doing that [iwhatever the corporation tax rate is[/i .

They will want to avoid country-by-country reporting whatever the corporate tax rate is because while they no doubt pay some corporation tax here they will, like any international company, be using intra-company trades to minimise it.

It's ironic by the way because the oil spill in the Gulf of Mexico has led the US government to want to regulate the extraction industry more and one aspect of that was country-by-country reporting so they could tell just what an extraction company operating in the US was earning in the US.



Only on some right wing fantasy Island. It's like the trickle down effect. Pure fantasy.

The idea lowering the corporation tax rate will reduce avoidance is ridiculous. If tax can be avoided it will be whatever the rate.

If you want to argue that lower taxes increase the tax take as we see mentioned by various right wing politicians and economists from time to time that is a different debate than one specially about corporation tax.

I'd also be interested to know what you think about the possibly of an independent Scotland undercutting the rest of the UK's corporation tax rate. It would be very easy for Whitbread who own Costa who do pay corporation tax here (unlile Starbucks) to move north of the border and deny us their corporation tax for example.

Back to the original topic for a moment.

I see Mark Carney has now warned against anyone overstretching themselves on a mortgage. With interest rates at a historic low for so long, he's afraid that many will extend themselves in the hope that house prices will continue rising and when interest rates do rise, there will be sufficient realiseable equity in the property to avoid foreclosure. That is the economics of stupidity, especially given the 'help to buy' scheme. Even without interest rates getting into double digits, a lot of new buyers will struggle with just a 1% increase.

The average price of a house in London is now 16 times the average London wage. That is a completely unsustainable situation.

Instead of building houses that people cannot realistically afford to buy, why aren't we building homes that even the poorest can afford to rent?

The midde-classes don't need teaching. Us working class types who were brought up without a 'phone in the house fond it a daunting experience!

He's doing the correct thing by warning people. IMO the government is cynically and irrationally manipulating the housing market as the aspirations of the young to create a "feel good" factor in the hope of gaining a Tory majority in 2015. As soon as the election is out of the way they won't give two hoots for those same people when they are stuck in negative equity or worse.

Well its then up to HMRC to police the transfer-pricing legislation better. It's also up to legislators to show some urgency in modernising the tax system to cope better with international trade.

That was me in 1974 when I started work, we didn't get a phone in the house until 1979.

On the other hand I also had to be taught in the office how to use an electric calculator (note "electric" rather than "electronic", it was an electro-mechanical calculator) as calculators were banned at our grammar school, we had to do all multiplications on paper or in our heads

That is obviously true. However without things like country-by-country reporting which we don't have yet (it looks like it is coming) the government can't draft laws that HMRC can enforce to make sure tax is paid on profit earned here.

It [iis [/imodernising the legislation and getting things like country-by-country reporting in place that will give the government and HMRC the tools it needs to extract the correct % of tax from businesses and reduce avoidance, not knocking a couple of % off the rate in the hope companies cease tactics like transfer pricing.

Nice swerve - you still haven't answered the point put to you by two separate poster - why is it that if tax can be minimised to none that global companies still pay any tax at all? As you said why pay any tax if you can pay none? BP are paying taxes in the billions strange thing to do if you don't have to pay any?

The government have demonstrated that lower the top rate of income tax actually increased take and often increasing taxation has a negative impact on take - so again this is not fantasy it is reality.

Strange as it may seem, some companies, even global ones, do seem to operate with a sense of social justice



They have?

Where, when?

The tax take did go up when the 50% rate was reduced to 45% but that was because high earners deferred taking their bonuses until the new rate kicked in! Will be interesting to see if it increases the tax from now on.

I know that. I'm also aware that the 50% rate was only in force for one year and the spivs who deferred taking bonuses until after the rate dropped to 45% also brought forward bonuses to take advantage of the 40% rate before it increased to 50%.

My question was aimed at the simpleton who made the claim that lowering taxes increases the tax take

Well its pretty obvious some companies indulge in aggressive avoidance and some do not. Those not as aggressive will still be at it to a degree. If you think the consolidated accounting of group profit that determines how much tax BP pay here isn't being reduced by transfer pricing or other avoidance measures I think you would be wrong.

Either way it has nothing to do with the corporate tax rate and the fact you seem to think they pay their full whack rather undermines your argument it should be reduced. Why reduce it if the likes of BP pay up?



No they have not. This tells you why.

rlhttp://fullfact.org/factchecks/labour_50p_tax_rate_millionaires_leave_country-28645rl

What also happened was the reverse effect of the forestalling mentioned in the link above when the current govt announced it was going to drop the top rate.

Instead of forestalling people deferred incomes so they were not taxed on it until after the rate went down. So having deferred it the tax revenue took a jump in the year they elected to pay up as they declared more taxable income that year than when the 50p rate was in force.

So people elected to be taxed in 2009-10 tax year on projected liabilities for 2010-11 when they would have got hit with the new 50p rate.

Then in 2011-12 when it was in force they deferred income because they were told it going to drop.

Net result? Tax revenue in 2009-10 and 2012-13 jumps in net terms compared to the period the 50p rate was in force.

Had the 50p rate remained in force the effects of forestalling and deferring income would have disappeared.

What that means it was not a reduction the rate that caused a jump in tax revenue due to some ludicrous notion all these high earners were suddenly spurred onto ever greater entrepreneurial effort or all rushed back to the UK having up sticks and left.

It happened because our idiotic governments (plural) announced the changes in advance allowing people to indulge in tax avoidance. And yes the Labour govt was stupid not to realise announcing the increase to 50p in advance would would result in forestalling.

My cynical view is the Tories didn't make a similar mistake by announcing the reduction in advance. The tip off was deliberate.

Both governments lost out on tax revenue by allowing individuals to declare taxable income when it suited them by giving them ample warning. Incompetence or deliberate policy?

The fact the Tories claim it is proof a lower rate increases revenue is clearly an outright lie as it ignores these factors.

Now they will spin it the way they do because they are happy to peddle such misinformation but what about you? Is that what you are doing or did you just swallow the propaganda hook, line and sinker?