Reasons why Eoin Clarke should stay well away from tax issues
Posted by Christie Malry on October 17, 2011 at 8:13 pm
The Tories raise extra taxes of £240,000,000,000 off ordinary people while Vodafone pay tax of just £1,400.
Er, what?
Vodafone paid just £1,400 tax on profits of £3,500,000,000 accounts filed last week showed.
What?? Vodafone didn't file anything last week. Perhaps he has been snooping through individual accounts filed at Companies House, but unless he's prepared to tell us which one it's going to be pretty difficult to corroborate these figures and/or point out the errors in his analysis. Certainly the figures of £1,400 and £3.5bn don't tie in to anything in the group accounts, and I can't see any obvious UK holding company at Companies House that has recently filed accounts that this could be.
HMRC Tax Officials have described Vodafone's holding company in Luxembourg as an elaborate tax avoidance structure.
Sure they did. But HMRC settled the case because they knew it would never fly under European law.
Vodafone pay knock down taxes in havens around the world and avoid liability for tax due to share write-downs. This is the murky world of corporate greed at its worst.
This is nonsense. The real reason Vodafone pays tax at a low rate is that it has brought forward losses not previously recognised that it will now be able to utilise. It also got a whopping great credit to the tax line because of the settlement with HMRC. It's nothing to do with tax havens and share write-downs, whatever those might be. Eoin has written a load of gibberish here. It probably goes down well with his knuckle-dragging lefty chums, but it has no basis at all in reality. He should stop writing about tax because he doesn't know what he's talking about.
Ordinary families struggle with a tax burden while Vodafone escape.
The average family pays £1,400 a year in Council Tax.
The ONS says that this figure is in fact £1,165 per household per year, with £165 being paid on average in Council Tax benefit. So Eoin has overstated it by £400 a year 1.
The average family pays c.£2,000 a year in VAT.
Again, the ONS says that this figure is in fact £1,843 per household. Eoin's nicked another £157 2.
The average family pays £4,200 a year in Income Tax.
The average family pays £330 a year in tobacco/alcohol duties.
ONS says £4,737 3 and £620 4. So, by understating these two, we're probably back in agreement in total.
The average family pays £330 a year in Green Taxes
I'm not sure what he's lumping in there. I couldn't see anything that looked close to Green Taxes.
That's more than £8,000 tax.
OK, but we've always had council tax, VAT, income tax, tobacco and alcohol duties and green taxes. Where are these 'new taxes' that are clobbering 'ordinary people' to the tune of £240bn a year?
Now there are just shy of 30 million income tax payers in the UK. And there are approximately 26 million households 5. So, how on earth does he arrive at £240bn, a sum equivalent to £8,000 for every income tax payer in the land and £9,230 for every household? £240bn is fast approaching half the entire tax take of the UK, so the very idea that the Coalition could have found ways to increase taxation by this amount should have alerted Eoin to the fact that he was taking a one-way trip into fuckwittery.
At the danger of repeating myself, Eoin really should stop writing about tax because it's quite clear he doesn't know what he's talking about.
Notes:
i have asked him for a source on the vodafone numbers, both in a comment (which he seems to have just deleted) and twice directly on twitter (no response).
i've never seen a set of accounts where numbers run into the billions... but are still reported at a level whereby a tax charge of £1,400 could be identified.
Check out the sources provided dudes. Enjoy!
Also, your tables are for 2009/10 u poor sod. VAT has gone up 2.5% since then... and duties have gone up.. and NICs er/ee has changed.
Gees dude, are you for real?
Thanks Eoin.
So you're ignoring the part of the article that says "In the financial year to March 31, 2011, Vodafone paid £2.6billion in tax and the group’s effective corporate tax rate was 24.5 per cent.", then?
You don't mention, at all, that this is an overseas subsidiary and, therefore, it only accounts for a part of their overall profit and tax.
Now... the fact that companies can get tax relief for interest in tax havens under UK rules *is* a bad thing, and the authorities should be, at the very least, limiting the extent to which they can do so. In many 'non-haven' countries that is the case. But any valid point you may wish to make is ruined by your misleading cherry-picking of information that you don't really understand.
And Christie makes a perfectly sound point that your figure for the tax take from UK taxpayers makes no sense as whatever increases have been put through, they're not to that extent. Is your £240bn figure over a year? a parliament? something else? That number isn't in your sources.. which, in any case, don't count for a lot because they are self-referencing (and one of which seems to call the entire tax revenue 'extra taxes', which doesn't fill me with confidence). Also, you have only given us all the areas where a household will have paid more tax... you've not factored in the fact that changes to tax thresholds (notably the personal allowance) have reduced income tax for the majority of people.
They don't add up to an additional £9,200 per household though, do they? Would you care to explain how these are "additional" taxes? Do you mean they're "additional" to the taxes that were charged in 2009/10?