The unions are rampant, baying for private equity blood. No image sums it up better than Paul Moloney saying in The Observer that 'we will chase them down every rat hole to find out where they are getting their money from and who they are ripping off. They're on Custer's last stand.'

Which is an odd historical reference, to say the least.

The Free Dictionary describes such a reference, charmingly, as referring to 'the savage and excessive killing of many people' (which brings a whole new meaning to class war).

Custer was for many years treated as an heroic figure fighting against savage forces, too, though history has not necessarily endorsed that idea.

But perhaps the best point to note is that the killing by the North American Indians of Custer and his men was the prelude, and in part justification for, the almost complete extermination of the North American Indians altogether.

I don't think that outcome is what the trades unions are after. Can I suggest this to Mr Moloney as bedtime reading?

June 11, 2007 | Permalink | Comments (0) | TrackBack (0)

Not really about tax, but I thought I'd post this column here, so that if people feel that way inclined, they might post more reasons why accountancy is like football or, on the other hand, isn't like football. Knock yourselves out.

As Deloitte unveils its football survey, and we unveil our Top 50, a PR asked me last week: are the Big Four in accounting the same as the big four in football?

On the face of it, there are many similarities between accounting and football.

It seems like a long time since anyone challenged Manchester United, Chelsea, Liverpool and Arsenal for a Champions’ League place.

There are those clubs, like Andersen, which have disappeared off the face of the earth, despite their earlier prominence. Leeds United spring to mind.

The average earnings in the Premiership are not so different to those of a partner in a firm. And in both cases, many would say they’re overpaid.

Once you’re stuck with one accountancy firm, you can’t swap colours, no matter how much they infuriate you.

E&Y, like Arsenal, are fourth, and both have foreign managers. John Connolly of Deloitte likes to refer to himself as The Special One, I hear (oh, OK, I made that one up).

But there are differences too. Accountancy is bigger in the US than football is.

There are lots more foreign players in UK football than there currently are in the UK accountancy market.

A Russian billionaire is unlikely to come in and plough hundreds of millions into a firm.

The FA always seems like a mess, unlike our beloved FRC.

If you write about football, people are interested. I don’t always get the same response when I tell people what I do.

Qualifying for something is regarded as a good thing in football. But the biggest difference, in my view (and I speak as a Spurs fan) is that BDO and Grant Thornton have no real chance of breaking into the Big Four in the next year, whereas Tottenham do.

Come on you Spurs!

And one other thing: football is like accountancy because we pretty much invented both of them.

June 8, 2007 | Permalink | Comments (0) | TrackBack (0)

The talk about a clampdown on private equity tax rules is, it seems to me, raising hopes on the part of the unions that are likely to be disappointed.

The most interesting contribution this morning, I thought, came from The Times' story on the subject, rather than from one of the many opinions pieces on the subject. Interesting because it suggested precisely what someone wants to do, rather than vague chat about 'cracking down' etc etc.

It said:

The GMB and other critics argue that carried interest should be taxed as normal income and not as capital gains, which are subject to taper relief, meaning that those involved pay as little at 10p in the pound on their income.

That's rather easier said than done. The 'carried interest' is more profits from shares held in the businesses, as far as I understand. I may be wrong, but I think any company director can do this and profit from the business asset taper relief provisions (the timescale for taper relief on personal shareholdings is much longer).

It's hard to see how you could target private equity executives. Perhaps by redefining whether or not a PE partner really holds those shares as a 'business' asset (a company director is more closely associated with one business, perhaps). But it would be fiendishly complicated to try and say one of those activities is different from another.

The other issues in private equity taxation have been about interest relief, a whole different ballgame, and one that would also have knock-on effects if tinkered with.

Nicholas Ferguson, the chairman of SVG Capital, said he couldn't see any reason why private equity tax rules could be justified. I can't see any way they could be changed.

June 6, 2007 | Permalink | Comments (2) | TrackBack (0)

There's a comment on a post by Dennis Howlett about the tax 'amnesty' that's interesting, from Simon Sweetman.

Talking about how the banks have offered offshore accounts in the past, he says:

The pattern has been that the banks suggested to people with reasonably large deposits that they might put their money offshore. Ostensibly this would be to get a better rate of interest, but the rest of it was done with a nod and a wink (of course the Inland Revenue will never find out if you don’t tell them…). Currently they’re suggesting Singapore.

All of which I found very intriguing. I've always fancied going undercover to find out whether the firms would offer me some outrageous tax planning, but it would be fun to do it with the banks aswell. I'd have to fake a large bank deposit, it seems; somewhat easier said than done when you're just a lowly tax hack.

June 5, 2007 | Permalink | Comments (0) | TrackBack (0)

A while ago I wrote about moves by the government to suggest that the tax profession saw carousel fraud as some kind of tax planning, rather than the organised crime it actually is.

Let nobody claim that there is anything mainstream about carousel frauds after the skull of a Scottish accountant was found in the Firth of Clyde.

Andrew Ramsay had been interviewed by Customs & Excise (and had been cleared from suspicion too, apparently) with regard to a carousel fraud.

It's early days, but the whole story does rather put into perspective any views we might have on how awful complicated tax planning is.

June 1, 2007 | Permalink | Comments (0) | TrackBack (0)