Monday, February 27, 2012

Big UK business body opposes tax avoidance, offshore abuse

The tax justice agenda has come a very long way in a very short time. We're delighted to see some highly welcome statements, from the UK's Confederation of British Industry (CBI.) From The Independent:
The Confederation of British Industry (CBI) has backed new powers for the Government to stamp out aggressive corporate tax avoidance schemes, which the employers' organisation admits seriously damage the reputation of British industry.
Yes. And:
"John Cridland, the CBI's director general, said he accepted it was time for his organisation to push harder for businesses that aggressively avoid tax, even if they do so in a technically legal manner, to be brought to book.

"Traditionally there has been two categories: legitimate tax management, which HMRC accept is legal, and tax evasion that we don't support," he said. "If we're going to be honest in this public debate, there is a middle ground, there's a third category."
This is quite true. And Cridland is quoted in the Guardian:
"Business should not engage in abusive tax arrangements."
Phew. From the CBI, that's quite something:
"It's the first time we've said it this directly. It's quite a statement by the CBI."
We will presumably have very different opinions to them, when it comes to deciding where to draw the line. And one of the things they advocate is a General Anti Avoidance Rule (GAAR), which TJN Senior Adviser Richard Murphy is quoted in the same article as saying doesn't go nearly far enough. He calls the CBI's chosen approach "window dressing" - read his analysis here. It is an important one, and takes a lot of the shine off the latest surprising CBI statements.

Still, even if the CBI's chosen remedies are too timid by far, the words criticising offshore abuse are most welcome, and signal a profound shift in thinking that is going on in the UK. We like to think that we, along with others such as UK Uncut and Private Eye and several journalists, have done our bit to help shift the zeitgeist.


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