25 August 2016

What is the problem with paying your way?economy

I have always been incredibly proud of the fact that I pay tax here and have turned down schemes that would limit this.

For me it’s simple; if you operate in a country, you should be paying tax in that country. Yet it seems that many people are not of this opinion.

It is interesting to read today that the European Commission claims that Apple has struck a sweetheart deal with Ireland to reduce its corporate taxes, and the EC is looking to levy a judgement in the coming months against Tim Cook’s tech giant that could reportedly sum a massive $19 billion.

However, the US Treasury Department has, in no uncertain terms, accused the EC of unfairly targeting American firms. Ironic really, considering that last December the US charged three Swiss banks more than $130 million to avoid prosecution for helping Americans avoid tax.

Cook openly confirms that Apple has billions of dollars offshore and cites the system being unfair as the reason for not putting that money back in the US. I agree that across the world there are things that need to change. I don’t agree with the amount of tax that we have to pay in certain areas of business in the UK. It limits growth and innovation, but that doesn’t mean that simply not paying is the answer.

Not paying your way gives you a bigger pot to grow from. The money that you should have paid in tax you’re able to invest in innovation and grow far beyond the point that you would have had you have played fair. It’s not a level playing field and it hampers growth for smaller businesses in the market.

Imagine how much easier things would be if everyone played fair? One thing is for sure, these huge multinationals should not be able to avoid paying their share simply because they have global reach and the funds to pay for clever accountancy.

What do you think?

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