Wednesday, October 17, 2012

The Brits have tax loophole problems, too

From The Guardian newspaper

And one of the holes getting attention lately involves USA companies!

A US company wants to make some bucks offshore (and maybe avoid a few US tax payments) so they find a friendly country willing to give them a few tax breaks to ring their (the US company) cash registers on said friendly country's soil.

These financial machinations are frequently referred to as "loopholes." But that depends on whether you're the Loopholer (you got the $$$ breaks) or the Loopholee (you lost the tax $$$).

In this case, did a US company avoid US tax payments? I don't know. The tax laws are a tad confusing/complicated/convoluted, but in some cases, some companies seem to.

In any case, some of our British friends are screaming bloody hell about Starbucks having only paid 8.6 million pounds ($13,892,815 US) during the 14 years they've been doing business there. In that time their revenues amounted to 3 billion pounds ($4,846,258,935 US). Folks, dollars aside, that is one helluva lot of coffee in a land known to be full of tea drinkers.

While tracking down this story (just part of the service we offer around here) I found that the dastardly corporation Facebook is also guilty! FB's sales in the UK last year were 20.4 million  pounds ($32,957,662 US) and they managed to pay only  pounds ($384,489 US). A right nice piece of managing there, Mr. Z.

Considering the number of US companies piling up revenues in the UK, you just know the list of targets is going to grow and grow. And if the UK succeeds in revising their tax laws, adds to their coffers and maybe begin to get a handle on their national debt problems, we may see a few changes in our own tax regs. Maybe.

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