The Public Accounts Committee hearing with the Big 4 accountants took place\u00a0this\u00a0morning.<\/p>\n
If I'm honest I do not think a killer blow was delivered: I'd have loved there to be a\u00a0question, for example, on what each firm would have done for a client who wanted to take part in \u00a0Jimmy Carr type scheme; would\u00a0they\u00a0have introduced or not? I think that\u00a0would\u00a0have indicated where they really were. But none the less a lot was discovered.<\/p>\n
Ernst & Young seem\u00a0reluctant\u00a0to answer questions.<\/p>\n
KPMG were deeply\u00a0embarrassed\u00a0by questions on their lending staff to HMRC who then promote the\u00a0exploitation\u00a0of the\u00a0policy\u00a0on which they have advised.<\/p>\n
Bill Dodwell has no idea whether his\u00a0firm\u00a0have an office in the BVI (they have) and had difficulty justifying why his firm is in tax havens: saying it was to audit ignored the fact that people only need audits because they're there to avoid tax.<\/p>\n
The problem of these firms auditing tax arrangements they may have been involved in advising on caused clear\u00a0discomfort.<\/p>\n
All of the firms agreed they had taken conditional fees based on the success of tax planning schemes despite seeking to say they did not sell schemes: a paradox if there was one.<\/p>\n
And all the firms tried to deny selling schemes, but were happy to describe\u00a0arrangements.<\/p>\n
Tax efficient supply chain management was something they did not want to talk about - although all the firms sell it. It is, of course, about shifting profits into tax havens, about which they were willing to offer as\u00a0much\u00a0bluff as possible.<\/p>\n
They all agreed reform was needed - but were sure transparency and and\u00a0country-by-country reporting won't help - because knowing that no tax was paid could be so misleading according to KPMG.<\/p>\n
Like politicians there was a willingness to pass the buck towards the OECD - and at least welcome\u00a0recognition\u00a0from PWC that its project on profit shifting needed much more funding.<\/p>\n
And at the end of it all there was a feeling, hard to explain, but definitely real, that they were simply doing\u00a0their\u00a0best to duck the questions. Avoidance is their speciality; using language that does not reflect the substance of what is happening (so tax efficiency means not paying and tax neutrality means no tax, for example) is their forte. And in the face of that the feeling that there is, indeed a massive industry here that does work against the public good was impossible for them to dispel, because it clearly is.<\/p>\n
What's the way forward. I'd suggest three things. First, Codes of Conduct are essential, and a commitment to\u00a0country-by-country reporting, stopping using tax havens and to the ideas behind the\u00a0General Anti-Tax Avoidance Principle Bill are\u00a0essential\u00a0to that.<\/p>\n
Second, issues on\u00a0procurement\u00a0have to be looked at.<\/p>\n
Third, the\u00a0government\u00a0has to expand its consulting base on tax, much more widely. These firms have too much power.<\/p>\n
I'll be interested to see what the committee conclude.<\/p>\n","protected":false},"excerpt":{"rendered":"
The Public Accounts Committee hearing with the Big 4 accountants took place\u00a0this\u00a0morning. If I’m honest I do not think a killer blow was delivered: I’d
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