bang to rights
God forbid a case of sanity breaks out in the corridors of international governance but it seems like everyone’s favourite whipping boys, the corporate tax-dodgers, are about to be brought to heel. Why, banged to rights, they might even come quietly!
A range of new, innovative and long overdue tax proposals, designed to put an end to the dubious ‘tax-shifting’ strategies favoured by the likes of Google, Kraft, Amazon and Starbucks, are about to be brought into play. Or at least sensibly discussed and planned for the very near future. The proposals, recognising the complexities of pinning down profits in this digital age, are centred around forcing companies to pay tax where their real economic activity takes place. OK, the idea’s not rocket science but putting an internationally recognised legal framework in place thereafter probably comes close to being so.
Current (for which read historic) international tax regimes are clearly ill-suited to today’s economies and the aforementioned have ruthlessly exploited the tax-haven and transfer-pricing opportunities these has presented. Illegal? Probably not. Immoral? Oh, yeah. And whilst they (wrongly) claim that it is their responsibility to purely maximise shareholder return, I would unequivocally add that it is not their ‘sole’ responsibility and an equal onus must be placed upon the countries’ society & economy where they actually undertake their business. Recognising that the due tax benefits all parties in the long-term is central to the adoption of this philosophy.
The debate so far has been driven by the (almost united) European governments of the UK, France & Germany but they can expect the smaller countries of Ireland, Switzerland & the Netherlands, those which not surprisingly have most to lose, to do all they can to frustrate the process. And keeping Russia, India, China and Brazil onside is vital. Go to it, boys.
