Lebron James wrote:
Except its not an excuse is it. What Vodafone are doing is not only legal, but also acceptable in the eyes of the tax man, UKGAAP, IASB and the companies act 2006. Is it right morally? Probably not, but morality never increased share prices. A company that doesn't consider all stakeholders will not perform very well, generally, but to put the needs of the tax man in front of the needs of its shareholders is suicide!
Few large companies consider all stakeholders these days. The effect it has may well be detrimental but they still do it even in the face of evidence it makes no sense. M&S is a bit of basket case but was once a company that treated its employees well. They are now moving to the zero hours model believe it or not.
The suggestion from Private Eye is also that Vodafone are not behaving legally as the scheme mentioned has one purpose, the avoidance of tax. So it is not a legitimate claim against (for example) R&D expenses or whatever that may be covered by legistlation.
It's the same for wealthy individuals, who spend 6 months or more out of the country and become non resident, purely to pay their tax at a lower rate in another country. All they are doing are taking advantage of the system and looking after number one.
Why was there no uproar about individuals, creating limited companies, and getting their money out by way of a small weekly wage of , topped up by dividends? that way they pay less tax than they would if they were a sole trader or in a partnership? Whilst its not as lucrative as it once was,they were still exploiting the system, meaning the UK received less tax.
There is! It's been an issue for a long time. I know people who no only pay less tax by doing this but even manage to get fees paid for their children as students due to being classed as low income families. The fact only people who are on PAYE pay their full whack of tax has never been lost on me.
What is ironic is these people are often the first to complain if the likes of the NHS are underfunded.
We can argue about this all day long, but at the end of the day, every single person would pay less tax if they had the opportunity to do so. Vodafone are no exception.
That is just reductio ad absurdum. If that is true then everyone and every company would aim to pay no tax at all.
I am sure you aren't daft to enough to believe this is a workable situation and however big or small a state you want that some of it must be paid for by taxation.
It is therefore obviously the case that as tax must be collected taxation must be levied and collected fairly.
We already know some companies have achieved zero tax thus transferring the tax burden further toward the individual. So the fact Vodafone wants to pay zero tax is not justified just because that is what they want to do.
