Monday, December 3, 2012

Starbucks to launch fairtax coffee

starturn © fintag

News comments:
Starbucks has decided to tweak its management admin intellectual property fees and determine itself how much tax to pay in the UK. Isn't that a "fair" thing to do? Whatever "fair" means.

Fair - "Without cheating or trying to achieve unjust advantage: he played fair". Have Starbucks cheated? From a tax and legal point of view, no. From a decent cup of coffee, then yes.

But if only we could all "tweak" our net incomes and decide what tax to pay, wouldn't life be better? Well actually many of us already do. Hedge funds do it. Supermarkets do it. Energy companies do it. You probably do it too. When you buy a book you can decide to buy it on the Kindle and pay some VAT or you buy the paper version and pay no tax. Yep, this sort of ludicrous anomaly is why anyone with a brain can find a way to determine the tax they want to pay.

We learn two thirds of those earning a million left the country when the rate went to 50% (although reading the facts its not quite that simple). Laffer 1 Socialists 0. (telegraph)

With the UK and other countries like Italy trying to collect evaded taxes from fashionistas D&G when they sold their company at a low sale valuation to a company in the EU (Isn't this allowable as part of the Treaty of Rome?), we are living in a world where those in power are trying to pretend we live in the 1950s.

Alas, globalization is great tax leveller. With cheap travel and access to legislation at one's fingertips, Starbucks is just doing what every other company does. The UK government has procured huge contracts to the likes of IBM and Accenture who are paid UK tax and yet seem to pay no tax on their profits in the UK.

Problem is governments are helpless. Corporations run the show. The only way to collect more tax is to lower taxes so we don't mind paying. (economist). Chances of this happening in the West are pretty slim it seems.

Today's shorts:
Starbucks launches new fairtax coffee (aljazeera)

Obama to introduce 110% tax on Simon Cowell (foxnews)

Dolce & Gabbana get caught in Luxembourg trap (telegraph)

Today's longs:
Big bullies bully bullington boys (bbc)

Italian police raid Google (reuters)

eBay to introduce voluntary tax donations on sale items.


Chris_moneyandi said...

Great article. Tax avoiders really piss me off. Too bad there's not too much we can actually do about it.

First time on this blog. Just got yourself a new reader - love the sources in posts btw.