I'm not even going to attempt to join in the debate on tax evasion and avoidance currently taking place on the TS blog.

But I can offer the following. Anyone interested in reading more about Murphy, his website is of interest. At the risk of alienating those who complain about my fellow AA blogger and I only referencing Accountancy Age stories, here's a piece we wrote on him.

Teather's book can be downloaded as a pdf here.

And one question to everyone involved in this debate. It's time the tax profession came up with a credible defence of some of the more extreme things it does. Is Teather's approach the right one? Are advisers going to continue taking a passive approach to the question of tax havens, abusive avoidance and even evasion (I've never met a tax avoider. At least, most advisers I meet profess, unconvincingly, to having nothing personally to do with it)?

One lighter question. Who at ACCA is going to chair this debate on June 6th?

April 28, 2006 | Permalink | Comments (4)

Mike Warburton is the 34th most important man in Gloucestershire. So say the compilers of a Gloucestershire Echo poll.

But I understand there is one fact my colleague TS may have missed in the report on the subject.

I'm told that everyone on the Echo's list had a picture featured alongside their names, except for Mike. He had to make way for a picture of swimming legend Sharron Davies, which took up the space for both of them and left Mike picture-less. (Without disrespecting Mike, we think she might make for a better shot).

And since this is such an important subject, here's a few more links. Here's one to one of Mike's recent columns in the Echo's sister paper The Citizen. And here's another to the bit of the list that refers to Mike.

Meanwhile, if anyone has any favourite power lists featuring tax advisers, well, it's absolutely imperative that you tell us about them at once.

April 25, 2006 | Permalink | Comments (0)

An announcement arrives from the Chartered Institute of Taxation. The body, the release says, has decided to give its annual 'Challenge the Chancellor' award to Malvern Girls College.

Schools were asked to name a new tax and why they would introduce it. Malvern suggested a nappy tax, to encourage parents to use environmentally-friendly non-disposable nappies.

Congratulations to Malvern, who now get to receive an award from the paymaster general Dawn Primarolo at the House of Commons tomorroe (and if you're reading, I've got a whole lot of questions for the minister that might be worth asking her...).

What I'm most interested in here, though, is the question: should the CIoT really be suggesting new taxes to introduce every year? Isn't that just putting ideas into Gordon's head?

And can we have a concurrent competition assessing which taxes should be dropped?

April 25, 2006 | Permalink | Comments (0)

What to make of HMRC's pursuit of city bankers who have been using offshore trading companies to evade capital gains tax?

Some have been saying what a huge issue it all is. Up to a point. The revenue's estimated return from the disclosure order it got from Special Commissioner John Avery Jones, albeit a conservative estimate, is only £35m.

The real issue here is, I think, the fact that this is an evasion and not an avoidance issue. The fact it was evasion almost got lost in the FT's headline, which read 'Tax Blow for offshore trading,' as if the chaps in the city had just been pulling some clever little legal wheeze, rather than defrauding the rest of us.

Believe it or not, the distinction still has some importance. It means that, pending the relevant discoveries by HMRC, some city figures (and one or two of them must be well-known given the amounts of money involved) could be in court in the next few years, and even be jailed.

We don't know what will come from the disclosures, and it may be that many were innocently involved. HMRC may reach settlements with the genuinely naive.

Those who evaded tax consciously are in for real trouble. HMRC and the Treasury find city bankers an easy target to whip up sympathy for their crackdowns of various kinds.

The opportunity to jail a few unscrupulous city high rollers, in the style of US authorities cracking down on white collar crime, would be too good to miss.

April 25, 2006 | Permalink | Comments (1)

The £71m deal EDS struck with HM Revenue & Customs over the tax credits system always seemed a bit fishy. Described from the outset as an 'aggregate' payment, it was always likely there would be some devils in the detail.

Now it emerges that the deal is not only tax deductible (a feature of such payments), but that part of it is made up of deductions against future contract wins.

The terms of the deal were confidential, and HMRC and EDS have been confidently batting off questions about it ever since the deal was signed in November.

So how did it emerge now? Apparently Sir David Varney told MPs in December in a private meeting of the Treasury Select Committee. Private enough, apparently, to mean that some senior members of HMRC themselves had to leave the room. But not private enough for someone present to disclose the details elsewhere.

Sir David is before a Treasury committee again today. What are the odds he'll say the confidentiality terms mean he can't talk about it? And will he make any reference to those who most likely leaked it? We'll see.

As for suggestions the government could be tempted to hire EDS just so it can be sure of getting its cash, I think the best one can say is the government hardly needs any more encouragement on that front. EDS has always attracted government contracts and cash by the bucketload. The £30m they are thought to need to pay back on top of payments already made is truly a drop in the ocean.

April 19, 2006 | Permalink | Comments (1)

This is a slightly childish point, but I've convinced myself it's one worth making nonetheless.

The Society of Trust and Estate Practitioners (STEP) has been co-ordinating responses amongst professional bodies to the government's clampdown on trusts, and its favoured outlet has been the FT. On two occasions that I can remember the paper has been better briefed on what the group was about to say than other people.

That's fine, to an extent. It irritates other journalists when the FT gets things first, but we all benefit from those kinds of exclusives in various respects.

The point really is that STEP, amongst others, is arguing that ordinary hard-working people are being hit by the move, and not just the super-rich, as HM Revenue & Customs allege.

If that's the point, why not leak the releases to The Sun or The Mirror, rather than a paper which caters to the better off and, dare I say it, those who might on occasion use expensive schemes to avoid tax?

April 18, 2006 | Permalink | Comments (0)

There are often suggestions made that companies are set to move their headquarters from the UK, in a protest against Gordon Brown's anti-avoidance campaigns, amongst other things. A similar suggestion appeared recently in the FT, with advisers arguing that a spate of foreign acquisitions of UK companies could erode the UK tax base.

I'm not sure how much I buy this idea. The first point to make is that if you make profits in the UK, you pay tax on them.

Multi-nationals then use a variety of processes, including shifting debt around, to 'plan efficiently' as they might term it, or to avoid tax as critics might describe it.

I don't really see why having an HQ anywhere else, or by being bought by a foreign company, in any sense increases or reduces these opportunities. The key point to consider in all of those cases is that profits will be moved to a low tax jurisdiction. If the UK is a low tax jurisdiction (and it may well be relative to many countries), the tax base will not be eroded.

It isn't that easy to move HQ's abroad anyway, and I think I'm right in saying you'd incur a tax charge in doing so. I can't claim to be an expert in international tax, however, and would be keen to hear from anyone who thought otherwise on this issue.

What the Treasury really ought to worry about, as far as I understand, are not the location of HQs, but companies deciding to situate new businesses, or new income producing assets, in lower tax jurisdictions.

They may do so for tax reasons, and that is tax that, through the difficulties of the UK tax regime, we would simply be throwing away.

April 13, 2006 | Permalink | Comments (0)

Is HMRC heading for trouble on filing deadlines? It announced at budget time that it would be moving filing deadlines back by several months.

We report today that the figures behind the campaign against the institute merger are proposing to reactivate their 20,000 membership in a new fight against the change.

Separately, I read in Taxation magazine today that it is starting a 'No to November' campaign, mobilising its readers against the move. It comes complete with a piece from Paul Aplin of the ICAEW despairing of the decision.

Two thoughts occur. Firstly, why do we need to move the filing deadline back? HMRC has not explained the move really, except to say simply that other countries do things differently, hardly a compelling argument.

And secondly, though there are many complaining, there have also been quite a few messages of support for the change, along the lines of 'we'll cope'. Will HMRC succeed through a strategy of 'divide and rule'?

April 13, 2006 | Permalink | Comments (0)