I agree with this sentiment in a press release from Christian Aid today, and so I share it:
Today, leaders of the UK's overseas territories gather in London for the annual Joint Ministerial Council at the Foreign Office. The focus, understandably, will be on disaster relief and improving resilience to climate change, following this summer's hurricanes that caused huge damage in the British Virgin Islands, Anguilla and the Turks and Caicos Islands.
As the rebuilding efforts develop, Christian Aid is calling for the UK Government and its overseas territories to work together to ensure that the overseas territories' economies are sustainable in the long-term. As many of these economies are reliant on financial secrecy and low tax, and following the Paradise Papers, the time has come to discuss how overseas territories might transition away from this status quo.
In the wake of global outrage over the recent tax scandal, ComRes, on behalf of Christian Aid, has revealed that almost nine out of 10 (89%) British adults say tax avoidance by large companies is morally wrong even if it's legal, while three-quarters (75%) say the UK Government should legislate to discourage UK companies from avoiding tax in developing countries.
Actions by governments against tax avoidance and evasion, driven by a turning tide of public opinion, coupled with the ever-increasing flow of information entering the public domain, call into question the sustainability of economic models that rely on providing various combinations of secrecy and low taxation.
Toby Quantrill, Head of Economic Development at Christian Aid said: “It is time to stop defending the indefensible and for the UK Government and the overseas territories to work together towards a sustainable alternative future for the good of everyone. We have been having the same conversation for more than four years and now it is time for action.
"At this Joint Ministerial Council, we need to see moves to create public registers of beneficial ownership in all the overseas territories, providing the same level of transparency that we already have in the UK. The UK Government also has a responsibility to support an economic transition and so far this seems entirely missing from these discussions.”
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If a company’s shares are owned by pension schemes, charities, widows and orphans, and the investment funds etc. of nationalised bodies, is this immoral as well? Concepts of morality and legal systems are often a bad fit one way or another. The Game Laws for example.
Yes, of course it is: the abuse is by the company invested in and they are not admitting it
The current inbalance of large Big 4 accountants advising companys that are aiming to maximising the avoidance of a fair tax causes unwarranted ethical and financial implications on Directors choices of what they do with the companys assets. Only by restoring fairness does integrity return in my view.
Lets start from the advisory system of auditing as the basis to understand the self dug hole.
1. Clean ethical businesses run well, demand, and get lower accountancy fees and the figures ‘add up quickly’. That is against the interest of the auditors who want to charge the maximum fees for minimum work in deciding what box to put a number into.
2. The Big 4 Learn from the spooks corruption and connivance techniques – bait the FD with a illicit tax dodge and the big 4 leverage the possible exposure of a misdemeanour of the FD by charging a higher fee. Losers: ethics and integrity of the FD, the Board and the ability to redeploy cash in the home country that it came from. Winners audit partner who has gained a house trained FD.
3. Big 4 expand the tax dodging overseas allowing a large unfair advantage over the home countrys providers e.g. avoiding the VAT rate (Big respect, admiration and acknowledgement to Richard Allen for getting to this stage and a reminder for him to power into the detail as the rear guard action takes place in the legislation), corporation tax, dividend tax and employment taxes. Losers: home countrys tax base, ethics of the providers, respect from others to the FD (note the big 4 accountants escape reproof as the 1 in 8 graduates seep into all regulating/protective agencys)
4. Big 4 accountants the providers of I believe little UK tax, little UK employment tax and having KPMG Deloittes plundered UK Plcs and businesses via RB Ss Natwest notorious Global Restructuring Group dubbed the Grim Reaper Group cause owners to take CGT losses in the UK and remove the CGT gains offshore via equity warrants and legal entity location.
The Big 4 have too much political power becoming an unholy cartel that no longer serves the shareholders upon whom they allegedly owe their allegiance and appointment from the AGM to.
They contribute little, they cause and take a lot and judging by the deliberate obfuscation of big bank audits, Carillions, rip cash from the country. The integrity of at least two being very below acceptable. Time to act and legislate no LLPs for auditors and the ability to sue them for failures of feigned ignorance of issues IMO
I have no love of the Big 4 but your relationship with reality is limited
agree with RM – go and read an IFRS standard and then come back and say how audit fees will drop ! the complexity of it all (can include tax law in that as well) is mind boggling
In PLC audit KPMG was at the bottom of the big four as rated by the FRC. Its next compatriot was Deloitte. Both a long way off, on a small sample size of the listed companies from the top two. FYI the top two were PWC and Ernst & Young EY with over 90% in the top two grades.
It seems the focus on big accountants must differentiate rightly on what culture allowed K and D to get in that state. Perhaps one is going to become the new Arthur Anderson . . .
This is a terrifying survey finding – the vast majority think obeying the laws set by us can be the wrong thing to do. I wonder what the percentages would be for people who disobey the law, my guess is a lot lower.
The undercurrent is that the fastest way to get bad laws changed is to break them, not campaign to change them,
And if that attitude prevailed then that would be a terrifying world to live in
You really do talk nonsense
Law has to reflect society. It is worthless otherwise
You seem wholly unable to appreciate this
People are saying the law needs to change. That’s how democracy works
I suspect you have little regard for it
transition isn’t a verb, it’s an American illiteratism so that’s two reasons not to use it.
That is a fair point. Will take note and use appropriately in future!
I managed to miss a capital letter in a carp about grammar; bugger!
A fish rots from the head down.
What should the employees think if their top bosses seem to be overpaying themselves without justification. That sets a very poor example to all those employees lower down the chain of command.
“if they do it why cant i do it” The shareholders end up paying through the nose yet again for the consequences.
For example: Dilutive share issuance that always seems to benefit the top bosses share option awards and plans but never the employees or shareholders. . . .
I wonder why the auditors seem to tend to avoid auditing Directors awards with the same rigour as the cash in the tills. . . for example.
The audit of director reward is based on whether or not it was approved. It is not, in the private sector, to do with value for money
You clear;y have very little knowledge of audit
Nor achieve your noticed the acres of space dedicated to director rewards in annual financial statements
You are not contributing to debate here
The Board of Directors have all the powers of the company plus Directors Liability insurance paid for by shareholders so Directors can and do approve anything. The only thing that might stop them is the people no longer being a Director and or changing their contracts of employment and their Directors Contract.
However I doubt any of them would tolerate the same behaviour they exhibit if the company was their pension fund
Maybe
But that is not an audit issue
You got that wrong
since when has democracy worked?
Clearly tax avoidance/evasion is “morally wrong” but can it be stopped?
The UK is a major player in many financial frauds as capital assets are transferred into a chain of tax havens, the Isle of Man being one corrupt link in this sequence. As they pass through each secrecy jurisdiction beneficial owners become confused with nomine shareholders as they skilfully change from one image to another in an impenetrable network of carefully crafted intrigue. Once the process is complete the (now innocent) assets are repatriated to the City of London to attract minimal tax obligation.
Despite the bluster issued by tax havens extolling “Registers of Beneficial Ownership” and “Tax Information Exchange Agreements” they are worthless while the tax havens remain integral components in a sophisticated worldwide network of financial crime. Fancy whitewash will never camouflage the putrid stink, but stinks often persist as only vague suspicions!
If an “outsider” ever ventures near to the system it simply mutates into another chain … and those brave enough to get really close receive the kinds of threats not unfamiliar to you and I. This is not an oversubscribed “club”.
Regards. You are doing great!
Also the beneficial owner responses are relied upon to be truthful and accurate which might not always sadly be the case. Seems like a Wimbledon legal ruling of predominantly white would be useful or more crudely guilty until proven innocent a bit like HMRC holding onto tax until a Directors loan is repayed.
I spend a great deal of time fighting Big 4 abuse
But the arguments have to be properly grounded
There is as much tax evasion as the state is willing to tolerate. If it’s right to sentence someone to two years for stealing water, it’s right to imprison people for robbing their tax liability. Write all tax law on one sheet of A4 and hey presto! We all know where everyone stands. Of course this can only happen in a democracy so that has to come first.
Respectfully, a moment’s thought will make clear that is not possible
Please do not waste time with silly comments
They will be deleted if they continue