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 Post subject: Re: #ParadisePapers
PostPosted: Mon Nov 06, 2017 7:08 pm 
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Ardillaun wrote:
ps200306 wrote:
Watched tonight's Panorama about the Paradise papers. Basic summary: "rich people avoid as much tax as legally possible". My reaction: "Yawn! Find me any person who pays more tax than they have to. Change the rules if you don't like them, but for god sake quit bitching about the legal stuff".


Only problem there is that the rich people make the rules via their political flunkies. So complaining is the only thing we can do.

Boycotting the "tax efficient companies" products might get a signal to them that what they're doing in unacceptable.

Easy for me as I don't own any apple products at all.
But I would imagine that there are many who are addicted to those products and would buy even if the company was openly dodging tax.

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 Post subject: Re: #ParadisePapers
PostPosted: Mon Nov 06, 2017 8:31 pm 
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dolanbaker wrote:
Boycotting the "tax efficient companies" products might get a signal to them that what they're doing in unacceptable.

Easy for me as I don't own any apple products at all.
But I would imagine that there are many who are addicted to those products and would buy even if the company was openly dodging tax.

You're going to have to do a lot of boycotting, not just the single company that acts as a magnet for the media and politicians attention.

What tech logos do you see within arms reach? Dell? Google? Microsoft? Intel? How about you duckduckgo them to find out which of them punishes its shareholders by reaching idealized standards of tax charity.


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 Post subject: Re: #ParadisePapers
PostPosted: Mon Nov 06, 2017 11:59 pm 
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Ardillaun wrote:
ps200306 wrote:
Watched tonight's Panorama about the Paradise papers. Basic summary: "rich people avoid as much tax as legally possible". My reaction: "Yawn! Find me any person who pays more tax than they have to. Change the rules if you don't like them, but for god sake quit bitching about the legal stuff".

Only problem there is that the rich people make the rules via their political flunkies. So complaining is the only thing we can do.

Interesting. You seem to have anticipated the second of the two BBC Panoramas on the Paradise papers. In that one we see an Isle of Man public servant literally changing the law at the behest of tax advisers to accommodate their tax dodging clients.

Also in the second programme we see cases that look like a lot more than just sensible tax avoidance. The standard scam is to offshore the money in a trust, then get appointed as an investment advisor to that trust. Incredibly, we see people advising the trust to invest in homes, yachts, and art and wine collections for themselves (noting that they may have to "sample the wine").

There is also a credit card account to pay for any investment research carried out. This "research" gets done while on holidays in Florida or the Caribbean, with everything expensed. In some cases the trust "lends" money back to the person paying into it. It is allegedly only a mechanism for tax deferral as in theory the loan has to be paid back, but there is evidence that this doesn't happen. The cases cited here included members of Brendan O'Carroll's family involved in Mrs Brown's Boys.

Like I said, I'm all for changing the law to close tax loopholes rather than bitching about the people who very sensibly exploit them. But some of these schemes look like they cross the line into outright illegality. (Note: "look like" ... I am not making any libelous allegations :nin ).

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 Post subject: Re: #ParadisePapers
PostPosted: Tue Nov 07, 2017 12:19 am 
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The interesting thing to me is that it chips away at the veneer of respectability of such a broad range of wealthy individuals and companies. It adds another percentage point to the Brexit protest vote. I don't think the BBC mean to do that, but that's what happens


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 Post subject: Re: #ParadisePapers
PostPosted: Tue Nov 07, 2017 8:02 am 
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GameBlame wrote:
The interesting thing to me is that it chips away at the veneer of respectability of such a broad range of wealthy individuals and companies. It adds another percentage point to the Brexit protest vote. I don't think the BBC mean to do that, but that's what happens

Protesting brexit or a protest vote for brexit?
Anyways it clearly shows that the current system is rotten and designed to help the rich avoid tax. There is no serious attempt to reform. Maybe this will tilt it slightly even in terms of the mood music.

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 Post subject: Re: #ParadisePapers
PostPosted: Tue Nov 07, 2017 10:47 am 
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Brendan O'Carroll lives in the US. He gets the bulk of his income in the UK, although a lot from Ireland and Australia too.

He has income from all sorts of different sources.

He cannot keep on top of this himself. It is simply impossible for someone like that to know how much tax they owe and where they owe it without serious professional advice.

Who would blame him for telling his accountants and tax advisers to structure his affairs so that he pays as little tax as possible where it is due?


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 Post subject: Re: #ParadisePapers
PostPosted: Tue Nov 07, 2017 10:50 am 
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Skippy 3 wrote:
Brendan O'Carroll lives in the US. He gets the bulk of his income in the UK, although a lot from Ireland and Australia too.

He has income from all sorts of different sources.

He cannot keep on top of this himself. It is simply impossible for someone like that to know how much tax they owe and where they owe it without serious professional advice.

Who would blame him for telling his accountants and tax advisers to structure his affairs so that he pays as little tax as possible where it is due?

He is avoiding gift tax to his family, by the sound of it. As it is his family that should declare the gifts, they are the ones breaking the law, if that is an applicable statement.

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 Post subject: Re: #ParadisePapers
PostPosted: Tue Nov 07, 2017 10:52 am 
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That may be. I haven't read up on the details.

I have always though that giving parts to his entire family is a clever (legal of course) way of avoiding inheritance tax.

Though not much different to many family businesses in that regard.....


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 Post subject: Re: #ParadisePapers
PostPosted: Tue Nov 07, 2017 11:30 am 
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yoganmahew wrote:
Skippy 3 wrote:
Brendan O'Carroll lives in the US. He gets the bulk of his income in the UK, although a lot from Ireland and Australia too.

He has income from all sorts of different sources.

He cannot keep on top of this himself. It is simply impossible for someone like that to know how much tax they owe and where they owe it without serious professional advice.

Who would blame him for telling his accountants and tax advisers to structure his affairs so that he pays as little tax as possible where it is due?

He is avoiding gift tax to his family, by the sound of it. As it is his family that should declare the gifts, they are the ones breaking the law, if that is an applicable statement.

they are extended family but the money is for "working" on the Mrs Brown show XX ; the loans from offshore companies is a well known ruse

https://www.independent.ie/irish-news/f ... 70853.html

Quote:
Operating the trusts in this way had been entirely legal up until last March, when the law was changed at the behest of the Revenue.

Now income tax and the universal social charge (USC) must be paid on any such so-called loans issued after February 13 this year.
Loans issued before this date are also now subject to income tax, similar to benefit in kind charges on preferential loans.

To balance things out the law also states that should the loan be paid back, the employee can claim tax relief.


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 Post subject: Re: #ParadisePapers
PostPosted: Tue Nov 07, 2017 3:21 pm 
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The O' Carroll family have travelled a fair distance in two generations: Brendan's mother Maureen was a Labour TD for Dublin North-Central from 1954-1957. Sixty years on, and his own daughter, Fiona, is involved in what appears to be highly irregular offshoring of income.

A cynic might be tempted to ask whether continuous conspicuous charity and well-trumpeted philanthropy on the part of certain tax exiles and entertainment types might be an attempt to assuage guilt.


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 Post subject: Re: #ParadisePapers
PostPosted: Tue Nov 07, 2017 4:32 pm 
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In the Panorama programme we heard all about F1 driver Lewis Hamilton's VAT dodge and how hundreds of corporate jets have been bought using similar schemes. Maybe even Denis O'Brien's jet which the IT reported about > https://www.irishtimes.com/business/tra ... -1.2438581
The Isle of Man does similar big business in large shipping, it is not an exaggeration to say some of the largest ships in the world are registered in the port of Douglas, even though the anchor of some of them would not even fit in its small harbour, even still, all Isle of Man registered ships would sail with an Isle of Man flag, so it's puzzling how Mr O'Brien can have his jet registered in Isle of Man yet still have an Irish flag on his tailfin. [The above article makes no reference to the Maltese flag.]


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 Post subject: Re: #ParadisePapers
PostPosted: Tue Nov 07, 2017 5:39 pm 
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Three Quarks wrote:
The O' Carroll family have travelled a fair distance in two generations: Brendan's mother Maureen was a Labour TD for Dublin North-Central from 1954-1957. Sixty years on, and his own daughter, Fiona, is involved in what appears to be highly irregular offshoring of income.

A cynic might be tempted to ask whether continuous conspicuous charity and well-trumpeted philanthropy on the part of certain tax exiles and entertainment types might be an attempt to assuage guilt.


There's a gradual decline really

Grandfather murdered by the Black and Tans for refusing to inform
Mother TD for Labour
He makes terribly successful comedy and moans about politics
Daughter benefits from off shore Trust

His Grandson will probably grow up to be Sauron


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 Post subject: Re: #ParadisePapers
PostPosted: Tue Nov 07, 2017 5:42 pm 
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For anyone interested in this, the following podcast is worth a listen:
https://ftalphaville.ft.com/2017/08/04/ ... nequality/

Very good interview. Covers some academic research and he gives a good background on the statistics he's been using to estimate money involved in tax evasion structures. He also goes through the mechanics of how you do it, if you've enough money. He also shows that even as tax rates are lowered, evasion has continued to increase, and it's predominantly an activity of the wealthy.

There's an important point that the tax collecting apparatus (and it's agents of investigation) are really set up for taxing regular joes. It doesn't work so well when they try to pursue wealthy individuals who are internationally mobile and financially sophisticated (even when they perpetrate bona fide evasion).

Some of this (Paradise Papers stuff) is probably legal/arguably legal avoidance. The argument that "if it's according to the rules, anyone would do it" is wrong-headed, unless it's genuinely intended as a brute STFU. The rules are not like gravity or Maxwell's equations. This is a reflexive system open to influence and guidance, and implemented by people. There are also asymmetries involved: the rules that the rich use to move money (even legally) out of the tax net are not ones that a normal citizen could use, so they're generally not familiar. The wealthy person gains massively from the situation, so has incentive to make sure that this is the way things are and the way they stay. The bulk of people paying tax each lose a bit, but have less incentive individually to pursue the change of the rules.

If they ever change, it's by people finding out about them, and saying "that's unacceptable". The response may then be "but it's legal, and in my shoes you'd do the same", to which the answer can be "well lets make it illegal then".


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 Post subject: Re: #ParadisePapers
PostPosted: Tue Nov 07, 2017 5:48 pm 
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ps200306 wrote:
Ardillaun wrote:
ps200306 wrote:
Watched tonight's Panorama about the Paradise papers. Basic summary: "rich people avoid as much tax as legally possible". My reaction: "Yawn! Find me any person who pays more tax than they have to. Change the rules if you don't like them, but for god sake quit bitching about the legal stuff".

Only problem there is that the rich people make the rules via their political flunkies. So complaining is the only thing we can do.

Interesting. You seem to have anticipated the second of the two BBC Panoramas on the Paradise papers. In that one we see an Isle of Man public servant literally changing the law at the behest of tax advisers to accommodate their tax dodging clients.

Also in the second programme we see cases that look like a lot more than just sensible tax avoidance. The standard scam is to offshore the money in a trust, then get appointed as an investment advisor to that trust. Incredibly, we see people advising the trust to invest in homes, yachts, and art and wine collections for themselves (noting that they may have to "sample the wine").

There is also a credit card account to pay for any investment research carried out. This "research" gets done while on holidays in Florida or the Caribbean, with everything expensed. In some cases the trust "lends" money back to the person paying into it. It is allegedly only a mechanism for tax deferral as in theory the loan has to be paid back, but there is evidence that this doesn't happen. The cases cited here included members of Brendan O'Carroll's family involved in Mrs Brown's Boys.

Like I said, I'm all for changing the law to close tax loopholes rather than bitching about the people who very sensibly exploit them. But some of these schemes look like they cross the line into outright illegality. (Note: "look like" ... I am not making any libelous allegations :nin ).


ah yes; plenty of interesting stuff for revenue - e.g. Lewis Hamilton set up an aircraft leasing business to avoid the VAT; fair enough - but he should have paid the proportion that was used for non-business use (i.e. flying to visit la Scherzinger rather than a Grand Prix)

Quote:
Because of the customs agreement, if a jet or any other goods are imported into the island, they are regarded as having been imported into the UK, and therefore into Europe.


VAT can be reclaimed if the goods are used as part of a genuine business. So clients paid Appleby to help them set up chains of two or three companies as part of a leasing enterprise. But the data shows these businesses had no staff, no offices, no computers and no phone lines. And most had no real customers; the owners simply leased their jets from themselves.

The rules state that VAT must be paid in proportion to any private use of the jet, both on the purchase price and the continuing cost of flights. However, the Paradise Papers reveal that since 2011, the Manx government has been rubber-stamping structures allowing jet owners to pay no VAT, even when it appears their planes are used for some personal flights.

https://www.theguardian.com/news/2017/n ... ise-papers


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 Post subject: Re: #ParadisePapers
PostPosted: Tue Nov 07, 2017 8:39 pm 
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Col. Max Pyatnitski wrote:

Some of this (Paradise Papers stuff) is probably legal/arguably legal avoidance. The argument that "if it's according to the rules, anyone would do it" is wrong-headed, unless it's genuinely intended as a brute STFU. The rules are not like gravity or Maxwell's equations. .


The 'you would do it too' argument conflates what we think should be done and what we might do if we got the chance ourselves. They are different issues. In Ireland, I'm often on a country road with an 80 k limit that should be 40 k but I may still do 80 k as I am legally entitled to do. Doesn't change my opinion about the limit. I like to think I'm more envious and hypocritical than your average punter but I hope I can still can see this tax issue separately from my own situation. The term tax alchemy is a good one for the mysterious and magical world of high end avoidance:

https://www.theguardian.com/news/2017/n ... ise-papers

The Papers are a more serious matter for Justin Trudeau than most leaders. Two former Liberal PMs are on the list (I must admit Stephen Harper does not appear, to his credit) as is his close friend and campaign fundraiser Stephen Bronfman:

http://www.cbc.ca/news/business/stephen ... -1.4382511

JT is currently trying to tighten up the tax rules on small businesses and doctors (which I support) but the optics are awful. His very rich Finance Minister has some blind trust issues as well. The Sunny Ways brand has definitely taken a hit and he is being rightly mocked in Parliament every day for it. The nexus between the mega-rich and politicians will stay in the news for some time here:

Quote:
Davies Ward represented the Bronfman and Kolber families for years, helping them move money outside of Canada in the early 1990s and set up trusts in the United States and the Cayman Islands.

At the same time, Leo Kolber was a top fundraiser for the federal Liberal Party under prime ministers Jean Chrétien and Paul Martin, a role later assumed by Stephen Bronfman, his godson, in 2013. Kolber was also chair of the Senate committee on banking, trade and commerce.

A review of lobby registry records, parliamentary finance committee hearings and Hansards going back more than a decade shows that Davies Ward and numerous tax law and accounting firms were heavily involved in a campaign that delayed the passage of any such legislation by 14 years.

http://www.cbc.ca/news/business/paradis ... -1.4384912



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