There is much discussion at the moment about the tax dodging of international companies. I particularly liked the US Senate’s view of Apple’s arrangements, that they had reached corporate nirvana, in that their profits were off-shored to no country at all. They didn’t even pay Irish or Cayman tax. Some of the business bigwigs who were called in front of UK or US legislators threw up smokescreens – see Amazon’s pretence that most of its work is done in Luxemburg, or Google’s insistence that none of its UK employees actually closed a sale. The worst excuse is to say “we pay a lot of tax – just look at what our employees pay out of their incomes”. Yes, mate, their incomes, not yours. Perhaps the Google chief executive could be asked to say whether he would like to live in a country where the government only has 2.4% of the national income to pay for teachers and police, roads and welfare: because that’s the proportion of their income that they pay. In the UK, they pay .2% – that’s right, one fifth of one per cent. Government with those resources would not be able to pay police to protect Mr. Schmidt from protestors as he leaves the House of Commons, or an ambulance to carry him to hospital. Or a road for the ambulance to travel on. Or a hospital at the end of his bumpy journey. I am sure this is not the world he would, in his more rational moments, desire. What he wants would be a well organised and provided society, in which someone else pays for public services.
However, this is not the end of the matter. I’m only surprised that no Chief Executive has had the honesty to say “we pay only the taxes we have to – what do you do ?”. Because you can argue that the main failure here is by government to secure a leak-proof tax system. I can’t dodge tax; hell, I can’t even dodge paying for a parking meter or public toilet. How come these buggers can avoid almost anything ? If the argument is that they will always have smart lawyers who can find their way round and through a tax code that is thicker than War and Peace (actually three times thicker); well, pick a simple tax. Turnover tax would work. Just get on and do it, rather than (Cameron style) sending stiffly worded letters out: as Caitlin Moran tweeted, “yeah, that should do the trick”.
But spare the moral outrage. Here’s a malicious thought that came to me. Pensioners in the UK get a number of benefits, no matter what their income is. I have a pension more than twice the national average family income, but get free bus travel, subsidised fuel costs and (in time) free TV. There has been a suggestion that people should send these benefits back to the taxman, or simply not claim them: to which the rejoinder is “no, you change the system” (and also, given the number of pensioners who vote “don’t you dare change the system !”). In what way is a rich pensioner refusing to send back excessive benefits they can claim different from a Chief Executive refusing to pay corporate taxes they can avoid ?
I only ask.