Friday, 15 February 2013


Why do I bang on about tax-evasion? FIRST – Let me say I am pro-business and have been a professional Business Expansion Adviser for 50 years. I am also pro-tax planning – no business forecast is worth anything if it does not include and control future tax bills – and I have been a professional tax-planner and tax-compliance adviser to thousands of clients since I was 17 years old – I am now 70. So why criticise the current state of play?

Because for two-thousand years our peoples, our neighbours, our families and ancestors have worked very hard, taken huge risks, suffered awful poverty, died in terrible wars, and invented marvellous products systems and civilisations to create the unprecedented Real-Economy wealth we enjoy today.  And yet – many of our banks, economists, governments and auditors – all in the Money-Economy – insist that we are broke; that we labour under “Mountains of Debt”. In the wealthy, hard working UK, 220,000 families need Food Banks. In the USA, 45.8 million souls need Food Stamps. And thus, two thousand years of sweat, sacrifice and innovation have all been wasted. We are told that we are all useless.

This is bullshit. I am not a conspiracy theorist, but it is true and realistic to say that over the past  30 years “They” have stolen all the cash, all the liquidity, and hidden it in tax-havens. “They” are the crooks, the desk workers, who manipulate the Money-Economy, the paperwork that records the Real-Economy (real things – Food, Homes, Clothes, Furniture, Energy etc). To evade taxes that pay for civilisation, the crooked bookkeepers, the tapeworms and parasites embedded in our economic pipelines, siphon out both the tax and the capital to tax-havens. They gouge out $1 trillion a year (33 million jobs) from our High Streets, which is almost all the global liquidity we all work to create – now adding up to $21 trillion (693 million jobs) buried in tax-havens. Then they lend it back to us at extortionate interest rates.

These crooked bookkeepers are bankrupting nations – like Greece – in their insatiable greed for stacking up more and more of our money.  It has to stop. The funds have to be repatriated and invested in modern, useful, well paid jobs for our children. The “owners” don’t like these messages and use their wealth and influence to stop them. They now insist our youth should work for no pay – in slavery – for years. The medieval Indentured or Articled system, which allowed only rich kids to get good jobs, was finally abolished in 1948. It took bloody revolutions and two horrendous World Wars to break the selfish greed of the ruling classes.  The crooked bookkeepers have replaced those blinkered aristocrats, simply by fiddling the books.  It is time to sharpen the guillotines – again – before the system seizes up.

The laws for bookkeepers and all accountants, auditors, lawyers and executives. The vast PR machine for the very rich Tax-Evaders, continually pumps out the message that the world has changed and so new laws are required. The message we are being fed is that all past "Tax-Avoidance" complies with the old laws - and thus no penalities apply to the $21 trillion stashed in tax-havens. BUT tax laws globally have been and are relatively simple and intelligent. Transactions had to be and must still be:

1) On normal commercial terms (relevant to fanciful transfer pricing, royalties, interest rates and executive bonuses)

2) "Arms length" - Not between connected persons - individuals or organisations (relevant to inter-group ENRON accounting and pretence companies, directors, trusts, charities etc).

3) Not primarily intended to reduce taxes (relevant to all complex schemes).

If these simple rules are breached - the tax deductible claims will be denied - in the rich source countries (our High Streets) that are being plundered. Simple ...and very long standing in law. Bent bookkeeping is criminal in all tax regions; always was and always will be. New laws are not required to tax the past 30 years of siphons to tax-havens. There are hundreds of such past Cases demonstrated in tax law and such laws are applied daily in OECD regions.


Fighting tax evasion
Tax avoidance and tax evasion threaten government revenues. The US Senate estimates revenue losses from tax evasion by U.S.-based firms and individuals at around 100 billion dollars a year. In many other countries, the sums run into billions of euros. This means fewer resources for infrastructure and services such as education and health, lowering standards of living in both developed and developing economies.

Tax transparency and the fight against cross-border tax evasion have been key topics at G20 Summits in Washington, London, Pittsburgh and Toronto.
The OECD is helping to develop exchange of information networks through the Global Forum on Transparency and Exchange of Information for Tax Purposes

>> overview of the OECD's work on tax evasion (PDF, 790KB)
>> Latest progress made on exchange of information

1 comment:

  1. In the united kingdom the Labour government announced that it would use retrospective legislation to counteract some tax avoidance schemes, and it has subsequently done so on a few occasions.