What do these places have in common?:
Anguilla
Bermuda
British Virgin Islands
Cayman Islands
Gibraltar
Guernsey
Isle of Man
Jersey
Montserrat
Turks & Caicos Islands
The answer is that they are, of course, all British and tax havens.
Why do we permit that in 2015?
And yes, I know I have ignored the biggest of them all: the City of London.
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Because it’s too easy, that’s why.
Why bother to lead the world in science or space exploration or human rights or combatting disease or even in state funded healthcare when there is so much more money to be made by just looking after other’s money?
Another thing that is long over due to be dealt with is how easy it is for other foreign companies to acquire British firms through the City of London – something that we have still not dealt with since the Jim Slater/Tiny Rowland and James Goldsmith era.
Hang on Mark, and I hesitate to disagree with a committed thinker from the home team, is it truly a problem if foreigners own British companies?
In the end we are all Gaia’s children, even fat cat bosses. Besides, I’m not sure that we can prevent deals within the EU.
We must be very careful not to discriminate in any way, accidentally or otherwise.
UK got rich by taking profits out of its Empire. Isn’t foreign ownership an empire by another name? The profits from our foreign owned utilities etc go out of the UK therefore diminishing the UK. Or have I misunderstood?
No
You’ve got it
Hi Deirdre
I should explain more about why I make such a statement to avoid coming across as a bigot or a ‘little englander’ – yes you are right I may be giving that impression – sorry.
I have always agreed with Keynes really – something about countries owning the sources of their own production – having domain control or influence of it etc., being preferable to foreign ownership.
I mean take a look at Germany and how firms are ran there with greater involvement from regional government and trade unions. And we wonder why they are such a powerhouse and still a massive producer of goods?
My experience of foreign ownership was through my father’s old engineering firm that was bought out by a Yank investor in the mid 70’s. My father was made unemployed (with others) and the plant closed down, machinery sold off and the site was turned over for redevelopment – in short it was an asset stripping exercise of the kind that Slater, Goldsmith & Rowland were only too conversant with. Every year that firm used to have a Christmas party for the families – at 49 I still remember them fondly.
My father ended up taking the new owners to court over his holiday pay that they illegally decided not to give him as part of his severance package and with the help of his union, won the case. It was a small victory. He was a toolmaker who got paid for piece work and had already bought one house and was made redundant just as he paid the princely sum of £4000 for a new detached house in another part of the City. He bought himself an A shaped ladder and started cleaning the windows of the other houses on the estate in order to keep going.
He ended up as a night charge hand at bus depot, working nights for the rest of his life – a skilled man reduced to refuelling and cleaning busses. His tool chests lay unused in the loft upstairs for years until he died in 2008. He felt his generation had not done enough to fight rapacious capitalism.
In the 1990’s I ended up working on London and one of my colleagues was an Australian whose father was employed by asset stripping stock-marketeers to wind up UK firms that had been purchased to liquidate the assets and return the money to investors. She said her father found it was just too easy to go into these family firms and then just make huge promises to the other shareholders to get them to agree to takeovers that usually led firms being wound up. These were not poorly ran firms; it’s just that clever spivs found a way of destroying them in order to make money.
So foreign ownership if predicated on asset stripping is not for me Deidre and I’ve seen far too much of it. And it is still far too easy to asset strip in this country in the name of shareholder value for investors. The foreign firms who do this are prevented living with the consequences of their actions by geography – and so are their Governments.
I still feel that with corporate behaviour as it is these days (many corporations want to detach themselves from countries to become illusive for tax reasons, regulatory reasons), it is better for the State to work with domestic corporations than foreign ones. If the corporations don’t see themselves as stakeholders in countries and only beholden to shareholders – well that is a recipe for disaster. The results of that are all around us.
Therefore I’m afraid I will remain anti foreign ownership of British companies for ever. Well, if there are any British companies left to worry about that is.
That is my position and I see no reason to change it as yet. I often felt that the EU would be a bulwark against this sort of thing, but I think that Yank ‘race to the bottom capitalism’ has even captured the EU narrative now.
I was brought up in the era of Salter Walker and the repugnance that company induced
If only the same were felt now
Okay, thank you.
Doesn’t this also mean that we should stop investing in foreign companies, as we’re likely to diminish their home countries?
EU membership is also a problem in this regard.
Again, I’d say it was based on the reason for the so-called investment. Are we buying to make it bigger, better and increase employment or is it just a means of buying and then asset stripping or nullifying competition?
The modus operandi seems to be all about stripping out value and then leaving the State with the liability as jobs and industrial capacity are lost.
It’s wrong in ANY country.
Mark,
The only way to prevent asset-stripping is for the government and Civil Society to be involved. Or rather more than involved.
Loony neo-libs have answers for everything, or are given them by their handlers. Asset-stripping is a classic: they will say that this is actually ensuring the correct allocation of resources or similar, that somehow this is somehow efficient or productive.
Then you’ll get, “well how many horse drawn carriage builders do we need?” type drivel.
The right-wing are going to destroy this country, just like they destroyed Russia and others through the Soviet Union.
If you look at France today with the Dailymotion sale you can see that a country can be involved. Okay they have over spent and need as many French companies as possible to pay the countries debt.
Okay the French government have bigger problems than a small video streaming company. Why are they involved in this company.
However Jaguar has worked very well for the UK. Jobs have been created that wouldn’t have happened if left under UK ownership.
The real question is why cant the UK do some of these things themselves. Why did we need to have our car companies owned by foreign investors to be a success.
Why is the UK still the hub of the tax haven world? Because Albion is perfidious I assume.
Obviously we can’t expect the Tories to do anything about this. But you’d expect Labour governments to do something. Yet they don’t. I assume that’s because when any Labour minister suggests doing something, a delegation from the City of London lets the minister know the extent of the damage to the UK balance of payments that would result from our ceasing to engage in fraud, theft, etc. And the Labour minister immediately soils his pants and “comes to his senses.”
However, I don’t know of any actual examples of such meetings between City representatives and Labour ministers. Anyone know anything about that?
I have seen references …..
Mr Murphy,
Attempts to reform the UK’s Caribbean financial centers (as well as Switzerland) have not resolved the alleged problem of tax evasion.
Instead, investors looking for privacy have simply re-located their assets to the United States, where Congress has made clear that the nation will not engage in any form of automatic disclosure. There is mounting evidence of significant inflows into the country’s private banking industry, with Miami emerging as a leading global private wealth management hub.
Since the United States are of course fully immune to any form of international pressure, the result is that potentially non-compliant investors will continue to escape taxation.
Your ideological allies at the Tax Justice Network are coming to accept this reality.
A much smarter alternative would be to negotiate with Caribbean and European offshore centers a solution along the lines of a withholding tax.
Yours truly,
MR
A much smarter solution would be to get the people of the US to vote out the GOP
Mr Murphy,
Objection to international tax disclosure is not limited to the Republicans. In fact there is broad-based bi-partisan consensus in rejection of this policy. The entire Congressional delegations of the Union’s three largest States, Texas, California and Florida (see the latter’s letter to Treasury Secretary Jack Lew on this issue here http://posey.house.gov/uploadedfiles/irs-delegationletter-march3-2011.pdf) are firmly opposed to this type of engagement.
Warmest regards,
MR
And that really won’t make tye slightest difference at the end of the day
The GOP does not rule the world
“Why do we permit that in 2015?”
Isn’t it something to do with self-determination or self-rule?
You surely don’t subscribe to the idea that we in the UK have the ‘right’ to rule these far off places?
What would you have us do? Invade?
If you look at how poor the economies of some of these places were before they encouraged inward financial investment you cannot blame them for what they have done. Like those tiny islands that sell stamps.
Seriously, what are you suggesting we do?
A thin sliver of extra tax for the UK might destroy the economy of one of these places.
KRs
Tim
Of course we rule these places
Didn’t you notice we walked into Turks & Caicos when it suited us, because we could
Again, you’re in outright denial of the truth
It’s almost laughable how much you and your mates get wrong