PEOPLE SHOULD START LEARNING HOW TO ACT RESPONSIBLY IF THEY DON’T WANT THEIR LIFE TO BECOME CONTINUOUS STREAM OF BLIND FRUSTRATION

It seems that most people either confuse consequence with a reason or do not really care about the difference as long as they have a chance to vent their frustration.

It is unknown if they are aware that venting in the wrong direction isn’t going to solve the problem. Instead, it could stimulate the problem to grow bigger.

The following is one of many examples

“SHAME ON COMPANIES OR INDIVIDUALS WHO AVOID PAYING TAXES.”

Unlike tax evasion, tax avoidance is not a crime. It is legally exploiting the tax system to reduce current or future tax liabilities. 

Tax evasion, on the other hand, is the illegal practice of not paying taxes, by not reporting income, reporting expenses not legally allowed, or by not paying taxes owed.

Global companies such as Google, Amazon and Starbucks have come under heavy criticism for avoiding paying tax on their British sales.

In may 2013, BBC published Article named “Google, Amazon, Starbucks: The rise of ‘tax shaming'” by By Vanessa Barford & Gerry Holt with brief but very clear analysis.

It is all started in September 2009 when the Observer ran with the headline: “Avoiding tax robs our public services, declares minister”  whereby the paper reported that the government was planning to say a tax is a “moral issue” and that it was “determined to end avoidance and evasion.”

It followed by publications with the similar nature by the Daily Mail, the Daily Express and the Guardian. KJWW13

 
The Bureau of Investigative Journalism wrote that Starbucks has paid just £8.6m in UK taxes over the last 14 years according to a special report by Reuters.
 
And eventually, the bloated hype has caused real damage to companies’ business and their reputations.

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 Why British public decided to vent its frustration of business entities which have nothing to do with the problem? Tax avoidance is a legitimate way of maximizing profit.
 
The process of globalisation has offered huge opportunities by removing artificial barriers and created a much bigger market. Naturally, it did not take long for industries immediately to stake out a position. Companies grew enormously by spreading their business activities around the globe.
 
However, with colossal scale, come colossal problems. The company may have a good revenue stream in one country and losses in another. In the end, by using legitimate ways to avoid tax, companies (at least most of them) are not aiming to gain huge profits but rather to gain an insurance that it would help to balance up profits and losses.
 
But it seems that British public hasn’t been bothered by the fact that the increasingly loud frustration with global business not paying (as assumed) its fair share of tax has nothing to do with the reality.
 

I believe my conclusion is logical because should these companies would not pay their fair share of tax, it wouldn’t have been called “tax avoidance”. Instead, it could’ve been qualified as “tax evasion” triggering absolutely different consequences.

Instead of lynching the wrong party, British public should’ve turned its frustration towards the government of the United Kingdom. Because it is the government which has the power to draft and implement laws.

Companies do not come up with their own rules. Companies shall conform with the laws that the particular government (in this case the UK) requires business entities to comply with.

There is another element which neither angry British people nor politicians of the UK failed to consider.

If the legislation allows certain types of operations allowing companies to improve their financial health and the top management of any company would decide not to use that legitimate avenue to maximize profit because of some moral norms, it is highly possible that the entire top management team could lose their job in a blink of an eye. And possibly, shortly thereafter, the fresh ex-members of the top management could realize that no other company will employ them ever.

Therefore, it is essential for people to understand one thing. If they believe that they can demand, first, they should carefully study the subject of their demand to avoid a possibility of being embarrassed for barking up the wrong tree.

As to the statement of Stephen Timms, former financial secretary, regarding paying tax being “moral issue”, there is only one word to describe it – NONSENSE.

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Paying tax is not a choice. Therefore it doesn’t fit the definition of “moral”. The issue of tax belongs to the legal sphere. And for the avoidance of confusion, it shall remain their forever.

The reason I mentioned confusion is that Mr Timms is already confused just by trying to carve out the issue of tax from the legal area and place it next to moral values. 

Before taxation migrates from legal to the moral zone, six events are required to take place:

A. The day when Hell freezes over;

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B. Tony Blair stands trial in Hague for lying to the British public and the entire international community on Iraq’s possession of WMD and committed crimes against humanity by aiding George W. Bush and actively participating in initiating illegal war in Iraq in 2003.

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As a result of this illegal war,  hundreds of thousands of lives were terminated for no good reason. Millions of people were displaced. The war triggered a process of destabilization of the entire region and caused the biggest, as it is called, refugees crisis in modern history. 

The war is also responsible for a sharp increase of terrorist activities as a response to the terrorist act committed by the British government.

Unfortunately, the ones who are killed by terrorists are innocent people worldwide. These victims had nothing to do with the biggest terrorist act in the entire history of human race committed by the US and the UK governments. And even today, fourteen years later, many civilians in Iraq, the Middle East and the whole world continue to suffer consequences of this despicable crime.

C. British government ceases funding the Royal family immediately and channels freed funds in the right direction – needs of society;

D. With immediate effect, British Royals are subject to financial disclosure and any other related disclosures without limitation whatsoever;

E. As any other private citizen in the U.K., all income of the Royals shall be subject to taxation because to pay their fair share of tax is in line with “values of responsibility” and belongs to the category of “moral issues”.

F. To adhere to “moral values”, the British government shall display 100% transparency and welcome with open arms the EU investigation into a British government scheme that may help multinational firms pay less tax.

The Guardian reported that the Paradise Papers once again show that secrecy, trusts, shell companies and a thriving tax-avoidance industry are undermining much-needed tax revenues in the UK and elsewhere. The revelations provide a glimpse of the moral bankruptcy of British governments which have done little to tackle tax avoidance at home or through crown dependencies and overseas territories such as Bermuda or the Cayman Islands.
 
According to the Guardian, the UK is responsible for the “good governance” of Bermuda and other overseas territories and Westminster has “unlimited power to legislate for the territories”. All laws of the British overseas territories are approved by the sovereign with advice from the privy council. Its members are senior government ministers and other politicians, including Lord Ashcroft, who became a privy councillor in 2012 and whose financial affairs have been leaked by the Paradise Papers. A public inquiry is needed into why the privy council continues to approve laws that cause financial harm to the UK and other countries.

 

The Guardian wrote that shell companies with anonymous shareholders and directors are a key feature of the Paradise Papers and its predecessors the Panama PapersLuxembourg Leaks and HSBC Leaks. Yet the government refuses to take effective action at home or abroad. Last month the government said it would not “prohibit nominee shareholdings”, a key mechanism for concealing the identity of the ultimate owners, controllers and beneficiaries of tax games.

In my opinion, the latest story about tax avoidance sheds the light on who is really guilty of creating problems for ordinary citizens and turning their lives into constant and painful frustration.

It doesn’t leave any doubt that representatives of any government, and especially the government of the UK, shouldn’t talk about moral values ever.

Vanessa Barford and Gerry Holt from BBC asked a legitimate question: what is an impact of growing culture of naming and shaming companies?

People should assume responsibility for their actions before they would have a moral right to demand anything from others. People should be clear that their actions may negatively impact other people’s lives.

Due to lack of knowledge and, therefore, clarity, people’s active participation in the process of public shaming of and boycotting business of the wrong party resulted in loss of jobs

As the result of unfair blaming, shaming and boycotting, the turnover of the Starbucks’ main UK subsidiary fell in the year to the end of September 2013 to 399 million pounds from 413 million pounds the previous year. Naturally, closure of a number of shops followed and as a result, many people lost their jobs.

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Is it fair that the government provides legal tools for businesses to improve financial positions and at the same time accuses the same businesses of acting immorally by following the law implemented by that very government?
 
Is it fair that because of public’s readiness to start engulfing frustration 360, caused a real negative impact on legally “innocent” business and hardworking individuals?
 
Both, the company and employees, suffered for not committing a crime. Whereby the guilty ones are just fine and the public continues to support them.
 
Who the hell killed logic?
 
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