Strange news: tax avoidance and offshore dealings

[dmg]

Taxes are different though for the super rich and that's why most of them live in tax havens like Monaco or Switzerland so as Dusty said we should at least be grateful he is still here paying taxes.

Chances are that he would be unaware of it anyway letting his advisers get on with their work.  Maybe Ingrid would know more at this point.

[Jules]

Its better than his accountants take his money to Jersey than to Paraguay 

[twm]

"We don't pay taxes. Only the little people pay taxes", the super-rich Leona Hemsley is reputed to have said. Read about her here:-

http://en.wikipedia.org/wiki/Leona_Helmsley

OK, she was done for tax evasion (an illegal activity) not tax aviodance (which is not illegal) but some of these tax avoidance schemes, as I said before, seem artificial to me. If they were clearly illegal, the authorities would have gone after them but, if they are on the borderline between tax evasion and tax avoidance, then it is difficult to pursue a case. Some tax jurisdictions are opaque.

I was aware that U2 transferred their companies to the Netherlands to save tax and it caused a lot of animosity in Ireland at the time. I seem to recall that the Rolling Stones, having sold tickets for a concert in the UK, then postponed it (to another tax year, I think) because they gained a tax advantage by doing this.

As is well known, Amazon and Google minimize their tax bills by routing their money through Luxembourg. Yes, they pay some texes in the UK but not as much as they should if they had not set up elaborate corporate structures deliberately to reduce their tax liability in the UK. No wonder smaller UK-based companies cannot compete. It is not a level playing field.

No one should pay more in tax than is required of them and I'm sure that MK (and other very rich people) pay large chunks of money in taxes to the Exchequer but that doesn't absolve them from having to pay more if it's due.  People who advocate a fairer, more just and more equitable society should not set out, by artificial means, to minimise their contribution to that society.

I am no revolutionary but please be clear - you and your families, even your elderly grandparents, pay more in tax than would otherwise be the case because large corporations and wealthy individuals use clever devices to keep their taxes down.

[ds1984]

The Rolling Stones case is a little different. They postponed their 1998 UK tour into 1999 because a new UK law had been voted AFTER they did set it up.

See ROLLING STONES CANCEL UK DATES IN GOVERNMENT TAX SNUB

BUT at the same time, Sir Mick did have his Rolling Stones business operating from Netherlands where companies such as these are taxed to a very low rate of just 5%

[twm]

Re Rolling Stones:  whether the change in the tax law would genuinely have affected the financing of that tour to the extent stated, is open to some doubt in my mind. We are talking of a guy who married someone, lived with that person as man and wife, then, when the divorce was taking place, said that the marriage wasn't a genuine one.  I seem to recall that, at the time the UK shows were cancelled, Jagger also said he was concerned that the road crew would have been adversely affected by the change in the law.

The tour in question lasted a year, played around 100 concerts to 4.5 million people and was the biggest Stones tour to that date. Why did Jagger isolate the European leg of the tour in his justification? Well, on the European leg of the tour in question, five shows in mainland Europe (in France and Spain) were cancelled entirely - that is, they were not rescheduled. This is in addition to the shows that were postponed and the shows that were postponed were not just the ones in the UK.   

[Guitarman1972]

It's all depends how you look at it. As if paying taxes is a good thing? Criminals have taken over our goverments and most of the tax money goes to these private interests nowadays.

I rather have Mark avoiding taxes to put it to some good work then his tax money being used for some bad work, like a bomb paid with tax money that will blow up some innoncent childern in the middle east area. Mark atleast puts joy into peoples lives. We can't say that about the politicians who put the money through to their friends who are the captains of industry, the militairy industrial complex or the banks or whatever.

In the Netherlands we have had the privatisation of goverment run organisations in the 90s, which has been nothing more then theft from the public, cause the so called investors didn't have the money to buy those organisations, which were build up by the public over generations. No they colluded with the banks, who printed the wealth/money out of nothing for them. Politicians said everything would become cheaper because of rivalry. But that was not the case. Proper health care is now almost unaffordable. Besides that the goverment repelled the organisations (hospitals, energy, transport, telecommunication etc.), but it didn't mean that we have to pay less taxes. With other words the goverment provides less and less services, but we still have to keep paying the same amount on taxes. Someone explain that to me.

So all with all it depends how Mark uses the money that he gained/saved throug tax evasion. If he employs some extra hands at his studio, or for the artwork for his new cd or for on the road/tour. I really could care less.

[Lestroid]

Well the article said the specific item in question for MK was a trust for his ex-wife Lourdes and the boys.  Lourdes is a US citizen living in London.  The tax shelter may be as much about sheltering the income from US taxes as British taxes because the US has a pretty oppressive tax policy towards US citizens living abroad.  Not only do those citizens pay taxes to the government where they reside, they also must report and pay US taxes as well, even if the income originates and is taxed outside the US.  It seems that policy is pushing record numbers of US citizens living abroad to renounce their citizenship simply for tax reasons.

I think that policy is absurd and I don't have any problem with someone sheltering their income from it.

[Jules]

I dont know how this things works in the Uk, but if Lourdes, a US citizen, marries MK, a UK citizen, then Lourdes is a UK citizen by marriage, even after the divorce, doesnt it?

[Banjo99uk]

I dont know how this things works in the Uk, but if Lourdes, a US citizen, marries MK, a UK citizen, then Lourdes is a UK citizen by marriage, even after the divorce, doesnt it?

No she would have to apply for it. So maybe she never has. It is also ridiculous that a Yank continues to pay tax in the US even if they dont live there. It happened to my wifes family and they chose the cheapest state to be "resident" in before leaving the US.

[twm]

I'm not sure the marriage route applies now. Someone I know in Britain married a woman from Eastern Europe who had lived in Britain for several years but, some years after the wedding, she still had to apply for British citizenship.  It didn't happen automatically upon marriage.

Double taxation is a vexed question. The country in which the person resides feels that the person ought to pay towards the services provided. The country of which the person is a citizen feels that the person ought to pay towards the services it provides. In the latter case, you may ask "what services?"  so let me give an example. Should a US citizen resident abroad get involved in some kind of difficulty abroad (from losing a passport to getting caught up in political unrest), he or she would expect the US government to help - consular services perhaps or rescue even.  The provision of those services cost money that is raised through taxation. It is not a straightforward matter.

On reflection, I think Google's European base is in Dublin. U2 moved their base from Dublin to the Netherlands and Google settled on Dublin.  It sure is a mixed-up world

To move on, these various countries are not known as "tax havens" without reason. THE ECONOMIST, a well-respected and prestigious UK magazine, has adopted the following definition: "What ... identifies an area as a tax haven is the existence of a composite tax structure established deliberately to take advantage of, and exploit, a worldwide demand for opportunities to engage in tax avoidance." 

It must have been 50 years ago that I bought a copy of Andre Hodeir's "Jazz : Its Evolution and Essence". My copy is a paperback, with now-yellowed pages, many of them loose, and I forget almost all of its content but I do recall two of the epigrams it contains.  One was from Freud: "All attempts  at definition give rise to difficulty; let us therefore not hope to escape them in our present effort". THE ECONOMIST acknowledged that the above definition of a tax haven is not without its difficulties but it is a start and, just because it is difficult does not mean that we should give up on refining it.

The other epigram I recall from Hodeir's book was from Camus: " .. where lucidity reigns, the scale of values becomes useless".  Many of these tax havens offer secrecy, whereas transparency ("lucidity") should be the rule.  If these tax arrangements are legitimate and comply with the appropriate tax legislation, what do these people and corporate entities (especially the corporate entities) have to hide?  To reverse Camus' words, "where lucidity does not reign, a scale of values becomes necessary" - very necessary in my opinion.

[Rkd]

My job is to make sure people pay as less tax as possible within the laws.

Maybe MK will be looking for a new tax person after this adverse publicity. Ingrid, get your resume ready! 

[sweetsurrender]

My job is to make sure people pay as less tax as possible within the laws.

Maybe MK will be looking for a new tax person after this adverse publicity. Ingrid, get your resume ready! 

No resume is needed for Ingrid. Guy can be the reference that she's the biggest MK fan in the world.
That's enough to get her hired.

[dmg]

My job is to make sure people pay as less tax as possible within the laws.

Maybe MK will be looking for a new tax person after this adverse publicity. Ingrid, get your resume ready! 

No resume is needed for Ingrid. Guy can be the reference that she's the biggest MK fan in the world.
That's enough to get her hired.

Ingrid would want to move all his money to Iceland. 

[ingridswing]

[/quote]

Ingrid would want to move all his money to Iceland. 
[/quote]

If only I had money ;-p

[IrisRose]

I think that we should wait for the facts.   Pottel has good information.  Thanks.   Not only does MK pay loads in tax, he also devotes loads to charity.  Yes, I know, charity donations are tax deductible--but only so far.    Better it should go to worthy cause than to bureaucrats anyway.