One thought on the GSK settlement over transfer pricing the other week.

The coverage tended to focus on Glaxo having a big tax bill (and less on the fact that it was less than the company had reserved for).

But a more interesting point from a UK point of view is that the profits giveing rise to a tax bill were disputed in that both the UK and the US were arguing the toss over where they should be recorded. If the UK, rather than the US, had won that argument, would the UK now be a few billion pounds richer?

It's a question that, were MPs well briefed on the issue, and minded to tackle the incoming HMRC boss on it, might make for an interesting discussion.

Tackling tax avoidance from UK nationals, after all, makes UK cash move around the system. Tackling transfer pricing avoidance means that cash that otherwise would go elsewhere comes to the UK instead.

September 27, 2006 | Permalink | Comments (0) | TrackBack (0)

Whenever an organisation's restructuring is going badly, and job cuts are on the agenda, it's always a bit difficult to be in the finance director's seat. Who wants to be the person associated with thousands of job losses, and with enforcing strict cost controls?

So is the departure of HMRC's finance director yesterday suspicious? There are, after all any number of rumours about the department's Gershon cuts going badly. And with the department devoting increasing resources to tax credits, the decrease in front line tax collectors (HMRC's main business line, you might say) is larger than people think.

Stephen Jones, the departing FD, was predictably effusive about his new role: 'When I heard about the position with the LGA, it turned out to be one of the few posts that I would have considered outside HMRC. That’s because it offers me a chance to use my skills in a completely different but equally exciting area of public service.'

But he notably didn't say anything about why he might be going.

Quite apart from anything else, his departure is a blow to the Treasury's plan to get FDs into every government department. Jones recently passed his exams, as far as I remember. Now they'll have to find another qualified FD, of which in the public sector there seem to be precious few.

September 20, 2006 | Permalink | Comments (0)