{"id":16496,"date":"2012-07-19T18:06:15","date_gmt":"2012-07-19T17:06:15","guid":{"rendered":"http:\/\/www.taxresearch.org.uk\/Blog\/?p=16496"},"modified":"2012-07-19T18:06:15","modified_gmt":"2012-07-19T17:06:15","slug":"the-38-degrees-olympics-tax-campaign-has-not-misread-the-law-its-talking-about-the-choices-available-within-the-law","status":"publish","type":"post","link":"https:\/\/www.taxresearch.org.uk\/Blog\/2012\/07\/19\/the-38-degrees-olympics-tax-campaign-has-not-misread-the-law-its-talking-about-the-choices-available-within-the-law\/","title":{"rendered":"The 38 Degrees Olympics tax campaign has not misread the law – it’s talking about the choices available within the law"},"content":{"rendered":"

A tax accountant has commented on 38\u00a0Degrees\u00a0Facebook page<\/a>\u00a0suggesting\u00a0they misread the law when, working with Ethical Consumer, they began their\u00a0campaign on the Olympics tax exemptions.\u00a0You can read what he said here<\/a>.<\/p>\n

I don't agree with him for many reasons.\u00a0If only it were as simple as he suggests! So let me offer some reasons why I think he's wrong to say this campaign misses the point.<\/p>\n

First, there is a the very good question of why if people are working here they should not pay tax here. Why is the\u00a0Olympics, paid for by the UK taxpayer, so special that it should be tax\u00a0exempt\u00a0and so make no contribution back to the UK for the\u00a0enormous\u00a0cost of staging the event? The\u00a0general\u00a0principle that sports people\u00a0earning\u00a0in the UK pay basic rate tax on those earnings in this country - which is then offset against any tax they owe in their home country - is widely applied. So, for example, it will apply to all\u00a0Wimbledon\u00a0winners if not from the UK and the winner of the Open Golf if similarly not from this country. It's the way sport and high earning sports people give back to host countries for letting them earn their income in events that usually require considerable tax\u00a0subsidy. 38\u00a0Degrees\u00a0are making that point with their campaign.<\/div>\n
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The same aplies to broadcasters covering the Olympics. Those\u00a0broadcasters\u00a0are at the\u00a0Olympics\u00a0in the UK - paid for by the UK - to make profit. Why shouldn't a fair part of their profit be taxed here? The rules to\u00a0attribute\u00a0profit to the UK exist - but they're not going to be applied. Why not is the fair question to ask?<\/div>\n
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And third, to claim major\u00a0corporates\u00a0could\u00a0not\u00a0exploit\u00a0this\u00a0opportunity\u00a0for gain is ludicrous. Sure, their normally UK resident\u00a0operations\u00a0will pay tax here\u00a0but in multinational corporations, many with hundreds or thousands of subsidiaries, the Olympics\u00a0exemption\u00a0would provide a perfect\u00a0opportunity\u00a0to make profit in the UK for companies based elsewhere and to extract that\u00a0profit\u00a0tax free. Any tax accountant could create such a scheme for a multinational\u00a0group\u00a0with little thought when all the normal rules on creating a permanent\u00a0establishment in the UK have been suspended. In that case we're asking companies to commit to not doing this. Some have. Good for them. Others have\u00a0not\u00a0and that\u00a0leaves\u00a0questions marks on what choices they've\u00a0made.<\/wbr><\/div>\n
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Those choices are legitimate, of course, no one is saying anything else. But it's also true that ethics\u00a0drive tax\u00a0choices, and\u00a0corporate\u00a0 responsibility demands tax is paid in the right place. In\u00a0this\u00a0case tax should be paid in the UK if profits arise here - as they will on\u00a0Olympics\u00a0related activity - and 38 Degrees are therefore challenging\u00a0those\u00a0companies\u00a0to make the right choices, to pay tax here on all profits arising in this country and to\u00a0confirm\u00a0they have.<\/div>\n
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To suggest this is a\u00a0black and white issue is as a result to wholly\u00a0misrepresent\u00a0the nature of group tax, the ways in\u00a0which\u00a0groups can shift\u00a0profits\u00a0and the\u00a0opportunities\u00a0that tax havens - whether permanent or\u00a0temporary\u00a0like this one - give to\u00a0corporations\u00a0to drop profits through non-taxed\u00a0loopholes. That's what 38\u00a0Degrees\u00a0are highlighting and what they're asking for is a commitment to not\u00a0exploit\u00a0this\u00a0opportunity. That's fair, and wholly appropriate and consistent with what the\u00a0legislation\u00a0might permit. And that's why I've\u00a0supported\u00a0this campaign.<\/div>\n","protected":false},"excerpt":{"rendered":"

A tax accountant has commented on 38\u00a0Degrees\u00a0Facebook page\u00a0suggesting\u00a0they misread the law when, working with Ethical Consumer, they began their\u00a0campaign on the Olympics tax exemptions.\u00a0You can
Read the full article…<\/em><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[10],"tags":[],"class_list":["post-16496","post","type-post","status-publish","format-standard","hentry","category-tax-avoidance"],"_links":{"self":[{"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/posts\/16496","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/comments?post=16496"}],"version-history":[{"count":0,"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/posts\/16496\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/media?parent=16496"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/categories?post=16496"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/tags?post=16496"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}