Forum Topic

Very interesting - any chance of it happening in the UK?

France is barring firms registered in offshore tax havens from its government coronavirus bailout, following similar bans in Denmark and Poland "If a company has its tax headquarters or subsidiaries in a tax haven, I [France's Finance Minister] want to say with great force, it will not be able to benefit from state financial aid,"
https://www.businessinsider.com/france-coronavirus-bailout-tax-haven-registered-subsidies-ineligible-020-4?fbclid=IwAR2mJSzoZ8EjEbphsKO5pmScKFlL_xtFoMAJoxa6_J-u4mhxBip7vHBj6JQ&r=US&IR=T

Ivonne Holliday ● 2392d11 Comments

According to Reuters, "Denmark has become one of the first countries to ban companies that are registered in tax havens from accessing financial aid during the coronavirus pandemic."Can't see the present government upsetting its supporters in this way, unfortunately.

Richard Carter ● 2392d

Yes, Denmark as well as Poland have taken measures against companies registered in tax havens.   I agree, Richard, it is not something I think this government will embrace.  Sadly.

Ivonne Holliday ● 2392d

That knocks off the list all those Virgin Group companies.

Jonathan Callaway ● 2392d

I note they say “offshore” tax havens so Luxembourg is not included. Most of what we buy from Amazon seems to be invoiced by Amazon’s Luxembourg subsidiary and they only use that to avoid tax in the UK.  I certainly agree with the principle behind the French decision but it doesn’t go far enough. Google uses Irish tax laws to avoid taxes in the UK so there’s another loophole that needs closing.

Jonathan Callaway ● 2392d

Yes, more of those loopholes need closing.  I was interested to learn from some young French friends that they were working in bookshops in Paris.  We should have done something so that we managed to keep more of ours - like the French have done.

Philippa Bond ● 2392d

Keeping bookshops open was / is in your and everyone's hands. Visit them and buy books.

Guy Cameron ● 2392d

This can often mean Switzerland, many multinationals have their financial hubs there

Bunny Payne ● 2392d

Interesting programme on Radio 4 yesterday morning about the prohibitive cost of housing in Cork. It said something about the Irish government's drive to attract foreign companies by reducing corporation tax rates had so driven down the corporate tax take that the government's ability to invest in infrastructure, social housing etc had been crippled. An interesting take on the policy of low taxes.Brilliant cartoon in the Evening Standard a couple of days ago with a plane entitled "Brass Necker"

Elizabeth Balsom ● 2392d

Here it is (the Evening Standard cartoon):

Richard Carter ● 2392d

Great cartoon! Virgin Group is a holding company and although registered and with headquarters in the UK which controls a multinational conglomerate from joint venture deals to arrangements just for licencing the Virgin Brand. For example, Virgin Atlantoc and Virgin Holidays is controlled by a holding company, Virgin Atlantic Limited, which is 51% owned by the Virgin Group and 49% by Delta Air Lines, and is separate from other Virgin-branded airlines. Virgin Records, one of Branson's original businesses, has a brand licence but is now owned by the Universal Music Group (Wikipedia). Interesting that recently that some assets in Virgin Galactica Holdings were transferred from Delaware to the British Virgin Islands: https://www.bloomberg.com/news/articles/2020-04-06/branson-shifts-1-1-billion-galactic-holding-between-tax-havens On a positive note, his group has deferred some royalties for brand licences: https://news.sky.com/story/coronavirus-branson-defers-virgin-brand-payments-11967504 I suppose the issue with any bailout for a Virgin Group company is that the group's structure is so complex that it's difficult to ascertain exactly where the money is going? To be fair, that's probably not something unique to the Virgin group, there's complexities with some of the rail companies as well. The trouble is, this is all being done very hastily - which may be necessary to protect jobs and businesses supporting infrastrcture - but I'm not sure the civil service is up to it!

Michael Ixer ● 2392d

Besides Virgin Atlantic, companies based in tax havens would also include Arcadia (Top Shop and the rest), Specsavers, Easyjet, Greene King Brewers, Pret a Manger and many more. (Courtesy Private Eye 24.04.20 p7)In any event, you'd expect any company applying for support would have to prove they weren't based in a tax haven, in contrast to their tax returns, which presumably make a convincing case that they are.

Peter Evans ● 2391d