The European Union Savings Tax Directive is being amended
There’s a very good web site that explains what the amendments are all about. It’s technically very good. I recommend it to all who are interested.
Feb 182010
Obama claims stimulus averted ‚Äòcatastrophe’
Economics
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Feb 182010
FT.com / US / Politics & Foreign policy – Obama claims stimulus averted ‚Äòcatastrophe’.
Barack Obama vigorously defended his economic stimulus plan on Wednesday on the first anniversary of the controversial legislation. The US president argued that the plan had averted “catastrophe”.
He’s right.
It did.
Microsoft and Dell don’t get it
Development, Tax avoidance, USA
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Feb 182010
I’ve just noted the finance minister of India saying:
The structure and the location of the group entities of the multinational enterprises exploit the favourable tax regime offered by the low tax jurisdictions and tax havens. This has lead to accumulation of wealth and shifting of intellectual capital to these jurisdictions. The role of tax havens and low tax jurisdictions has become an area of great concern for a country like India which is putting its all acts together to mobilize resources to attack on poverty and illiteracy.
Then I read in Business Week that:
Software and computer companies such as Microsoft Corp., Hewlett-Packard Co. and Dell Inc. are gearing up to fight an Obama administration plan to curb offshore tax avoidance.
The $15.5 billion proposal in President Barack Obama’s 2011 budget targets what the Internal Revenue Service calls the growing problem of so-called transfer pricing. The technique allows companies to reduce their tax bills by transferring intangible property such as patents, trademarks and licenses to offshore subsidiaries.
The Business Software Alliance, a Washington-based trade group that represents technology companies, said it would “educate policy makers” on how the proposal would hurt U.S. companies, jobs and the economy.
The finance minister of India speaks with some authority on the issue. Microsoft and its chairman seek to direct world development through charitable structures whilst diverting attention from the secretive tax policies that deny tax revenues to places like India by selling them product from places like Ireland so limited local taxable revenues arise.
Is this what Microsoft wants to ‚Äòeducate’ Washington about? Is this to be a lesson in how to move wealth from the poorest to the richest in the world, because that’s what these structures are used to do.
And how does that help your charitable objectives Bill? Let’s debate it, anytime, anywhere. Your call.
Feb 182010
The Finance Minister of India Shri Pranab Mukherjee spoke to a seminar on transfer pricing yesterday and said:
The structure and the location of the group entities of the multinational enterprises exploit the favourable tax regime offered by the low tax jurisdictions and tax havens. This has lead to accumulation of wealth and shifting of intellectual capital to these jurisdictions. The role of tax havens and low tax jurisdictions has become an area of great concern for a country like India which is putting its all acts together to mobilize resources to attack on poverty and illiteracy.
The financial crisis faced by us has been unprecedented in recent history. It is widely believed that the tax havens and low tax jurisdictions were an important actors in the crisis. The opaque system of Exchange of Information in these tax havens and their non-compliant behaviour has been a matter of concern not only for revenue base but also linked to financing of activities which are detrimental to national security interest.
It is in our mutual interest to maintain a healthy global fiscal system which is self-sustainable and all important actors including the tax havens comply with the established norms of transparency and fiscal discipline.
I think that says a great deal in a very few words that summarise much of what the Tax Justice Network has been seeking to raise awareness of, and change.
The awareness is now commonplace. Change is happening.
We need to celebrate the good news sometimes.
Hat tip to Martin Hearson, Action Aid
Credit card borrowers are bailing out bankers
Banking
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Feb 182010
FT.com / Banking & Savings – Credit card rates reach 12-year high.
Interest rates on credit cards have reached their highest levels for 12 years, according to research by Moneyfacts.
The financial data provider said that the average rate has risen to 18.8 per cent, despite the Bank of England base rate remaining at 0.5 per cent.
The political right are obsessing about financial transaction taxes and arguing they want hit biggest – and that they’ll hit the best off instead.
In the meantime they ignore the real issue of incidence concerning banks – which is that the cost of rebuilding their balance sheets is falling on these least able to pay.
The time for regulation of interest rates has arrived, and is long overdue.
Lex – Tobin tax: is Japan onside too?
Transaction Taxes
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Feb 172010
FT.com / Lex / Financial services & property – Tobin tax: is Japan onside too?.
Thed Lex column notes financial transaction taxes are getting support from an unexpected source:
For years, taxes on capital flows were seen as a barbarous relic of the 70s, on a par with Demis Roussos and Baked Alaska. No friend of free markets dared support the idea of US economist James Tobin, dreamed up to curb currency volatility after Bretton Woods collapsed. That’s changing. Since Lord Turner, chairman of the UK’s Financial Services Authority, started stirring interest in taxing financial transactions last year, politicians in Germany, France and Australia have voiced tentative approval. Now Japan, through the musings of vice-finance minister Naoki Minezaki, might just be falling in line.
As they also note – the new FTT in Brazil is working. But note the point they make: as discussion I am taking part in elsewhere on the web shows, the free market dinosaurs are opposed because their assumptions prove to their satisfaction that such taxes cannot work.
The trouble is that it’s their assumptions that don’t work, not the taxes don’t, as experience shows. But like all zealots they’re far from being in possession of open minds.
Rather unlike my position on these taxes, I have to say, which is that they can work – unambiguously well I’d argue in some markets, like foreign exchange, but not necessarily as well in the case of stamp duties, for example. That’s considered, open minded, reasoned and open to persuasion.
What a pity most economists don’t have that mind set.
Reining in the corporate monster
Ethics
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Feb 172010
Reining in the corporate monster | Prem Sikka | Comment is free | guardian.co.uk .
After committing nearly £850bn to rescue failing banks and printing another £200bn of money to lubricate the economy, the government is looking for tax revenues to manage the economic crisis. But corporate barons resent paying democratically agreed taxes.
Prem, as usual, hits hard at the core of the issue.
The reality is that global corporations threaten our democratic well-being.
If they can’t co-exist what wins? Corporations, or democracy? To Prem and me the answer is obvious. But corporations, I have no doubt, think otherwise or they would not behave as they do.
Keynes can help the eurozone
Economics
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Feb 172010
Keynes can help the eurozone | George Irvin | Comment is free | guardian.co.uk .
George Irvin addresses the issues facing Greece and the eurozone in the calm fashion only a seasoned Keynesian can adopt.
In so doing he makes the obvious point that we are not the slaves of money; it is a tool for our use. Why do so many forget that very simple fact?
Entrepreneur faces £30m tax demand
Uncategorized
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Feb 172010
Entrepreneur faces £30m tax demand after residency ruling leaves thousands exposed – Times Online .
Excellent news for tax compliance – it’s going to be a lot harder to claim you’ve left the UK in future. And that’s good for the rest of us, bad fcor tax havens and the complete answer to all those looking to leave for tax purposes because that has just got a whole lot harder.
