How misinformation about corporation tax breeds on the Internet
Posted by Christie Malry on October 25, 2011 at 10:43 pm
I was having a browse through the Occupy London Manifesto site the other night. And I came across this:
Er, what? This is so self-evidently false, it's startling that anyone could believe it. But where does this "fact" come from?
Well, there's this blog post:
But it really sickens me that my little business must pay tax and go through scrutiny of Customs and Revenue, and 98 of the top 100 grossing businesses in the UK DO NOT PAY ANY CORPORATE TAX!!!! That’s right, they skirt by that bothersome issue by renting a cheap office space in Jersey, and saying their business is based there!! It is absolutely disgusting what lengths businesses will go to to avoid paying their fair share.
The post doesn't provide any calculations, nor does it explain how you go from "avoid paying their fair share" to "DO NOT PAY ANY CORPORATE TAX".
But what's the source for Grande Dame's claim? Well, it comes via our friends Ritchie and the NGOs, who - you'll remember - had some fun with counting the number of subsidiaries of FTSE 100 companies which are based in what they define as "tax havens". They draw this up broadly, including the US state of Delaware (tax rate: 35%), Ireland and the Netherlands.
I already highlighted how Ritchie was playing fast and loose with his interpretation of the report. Given his following, this is grossly irresponsible.
But he's not alone. Sky News's report is equally sloppy. Under the headline "All But Two FTSE 100 Firms 'Avoid Paying Tax'", they say:
Action Aid found that 98 out of the 100 companies on the FTSE 100 base their operations in territories where there is low or no tax.
Gah! There's a whole world of difference between "having a subsidiary in" and "basing their operations in". And it's that sloppy, thoughtless journalism that feeds idiotic blogs, and ultimately fuels moronic policy proposals in left-wing manifestos.
That "Fact" doesn't come from my site, it comes from the Guardian and channel 4 news! But thanx for telling the world the fact that i invented that fact - brilliant! Here is the guardian link where I got the information - http://www.guardian.co.uk/news/datablog/2011/oct/...
Nope, I'm not seeing the "98 out of 100 companies don't pay corporation tax" claim there. Guardian writers may know very little about tax but they know at least that much.
So, did you derive it from Guardian data yourself or did you make it up?
here is the Channel 4 expose, watch it for yourself.. but thanx for telling the world I coined the phrase!! - http://www.channel4.com/news/should-the-governmen...
You are right, Channel 4 say "All but 2 of the top grossing FTSE 100 Companies do not pay Corporate Tax" .. I just did the math - 100 minus 2 = 98! Ha Ha!
The article from the link you provided doesn't say "do not pay corporate tax". It says they use tax havens. To the extent they make profits in those countries, they'll pay tax there. And the FTSE 100 companies pay the lion's share of corporation tax here in the UK.