STARBUCKS 2 – 007 AND TAX-HAVENS

The fair-tax pressure group, UK Uncut, plan to protest at several UK Starbucks Coffee Shops about the risibly small taxable profits ascribed by Starbucks to the UK from robust sales and massive expansion of their UK operations. Starbucks, Google, Facebook and other transnational groups will be quizzed today by a UK Parliamentary Committee on their profitable UK trading and the bookkeeping siphons applied to make the UK profits vanish.

These official enquiries have enticed in-house and external tax-planners, funny-money banks and transferors, journalists, helpful, kindly officials from Her Majesty’s Revenue and Customs (HMRC), politicians, and others onto the airwaves.

The tax-planners glibly justify the crooked bookkeeping. The money launderers justify bleeding OECD economies dry and plunging them into debt. The brain-washed journalists parrot “it is all perfectly legal” – because they too are fiddling their taxes. Bent HMRC officers offer for human sacrifice one or two hapless plumbers making an extra £50 a week in cash; but “forgive and forget” multi-billion dollar illicit siphons to tax-havens. Most politicians turn their faces to the wall as the gentlemen go by – but a few brave hearts recognise the devastation caused by the treasonable tax-evasion-capital-flight saboteurs (look at Greece and at the USA $16 Trillion deficit) and are at last speaking out. 

In the meantime, the global $21 trillion off-shore river of tax-free cash swells by $1 trillion a year, including organised crime proceeds, and most OECD countries – despite decades of efficiency and steady GDP growth - pay lower wages and sink ever deeper into debt. Then we have to beg the anonymous “free markets” and racketeers to lend us back our own cash, at high interest rates.

THE CRIMINAL BOOKKEEPING – If you imagine your international siphons are legal, consider ENRON and Arthur Andersen. For the past 120 years, in law, to obtain tax relief on profits made on the markets of OECD countries, the tax-deductible invoices or contracts must be: (1) Arms length (not fiddled by pals within The Group) (2) Commercial (at normal commercial prices not $2,000 an hour for a Cleaner, or a director, or $550 for a brass screw) (3) Necessary for the business (a valid expense, required to keep the business running) (4) Real (not for example a payment called “dividend” or “Royalty” that is actually a director’s fee under payroll taxes) (5) Not to avoid or evade tax.

REPATRIATING 0.2% IS NOT ENOUGH - The UK politicians, courts and tax-authorities are mumbling feebly about getting really tough on tax “avoidance”, smacking even their best Old School friends on the back of the legs with a wet flannel – and collecting, GOSH! - as much as $7 billion in the next 4 years.

The estimate of the UK’s share of the $21 trillion illicitly shovelled with tax-relief to tax-havens is $3 trillion. It is globally disproportionally large because the British invented tax-havens (to suit one or two posh aristocrats) and most tax-havens are /were British, and London is a major financial hub for such back-to-back transactions. $7,000,000,000 is only a tiny 0.2% of the total $3 trillion UK assets siphoned off-shore with tax relief and with the blessing of the UK Treasury. The easy NIL-TAX siphon is far too high a price to pay merely to attract a few million dollars of foreign investment.

The UK’s share (14%) of the additional $1 trillion siphoned annually to tax-havens is about $140 billion. No wonder we are broke.

If the UK can staunch the annual $140 billion out-flow and repatriate via back-duty-tax-cases (guilty until proved innocent) the $3 trillion hoard and invest it in our infrastructure and new 21^st century businesses – the real wealth of the accumulated sacrifices, work and ingenuity of millions of families over the past 200 years would be realised and the benefits enjoyed.

THE INTELLIGENCE SERVICES - The prize is so great, so fair and just to the whole community – and the opposition so cunning and ruthless – that our homely tax-collectors and creeping court processes, geared only to tracking down small “benefit cheats” and black-market tradesmen are not up to the international task. They are outsmarted, outgunned and out manoeuvred by the transborder, fleet footed, dissembling, multi-lingual professionals who operate the tax-havens siphons. Specialist teams drawn from the intelligence services, MI5, MI6, CIA, FBI, Interpol, James Bond etc and motivated with a share of collections are needed. They often are surprisingly intelligent; can be legally briefed in a few days; can track the assets with computers; are usually loyal to the homeland; and are tough enough to act quickly.

The Information Society can fix the world’s finances – and then we can get on.

(Nil Desparandum – If you are being investigated for false accounting, fraudulent conspiracy and tax-fraud, remember that all good tax-planners guarantee their advice and have Professional Indemnity Insurance Policies, usually written at Lloyds of London, to compensate you and them.)  

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