OcTaxLaw.com

Sporting Intelligence reports this morning that:

Leading football clubs are being heavily targeted by HMRC over perks afforded to players and WAGs partially because the taxman has already received information and tip-offs relating to major financial discrepancies at at least one top Premier League club,Sportingintelligencecan reveal.

The finance directors at all Premier League were recently sent a questionnaire containing 181 questions looking closely into the financial affairs of the clubs and players, specifically the issue of perks, as HMRC looks to crack down on blatant abuses of the system.

And as they also note:

The sheer scale of the questionnaire has surprised even tax experts.

Sportingintelligencecan exclusively reveal the questions from the questionnaire, including:

• 4.14 Are any payments made into trusts or sub-trusts, whether in the UK or abroad, for which employees or family members are, or are potentially, the beneficiaries?
• 1.2 Are any expenses paid, or benefits provided, to players or other employees spouses, partners or other family members, whether in the UK or abroad?
• 11.6 Has the club paid any expenses relating to an employees private holiday costs? If so please provide details.
• 11.7 Are there any circumstances where the cost of spouse travel will be paid for by the Company? If so please provide details.
• 22.1 Are complimentary tickets, use of a box, etc. provided for employees? If so please provide full details.

Sportingintelligencealso understands the tax affairs of foreign players will come under greater scrutiny. In some cases players have been found not to have paid National Insurance contributions (NIC).Other questions asked:

• 5.3 How does the club treat payments to foreign players for payroll purposes?
• 4.2 What controls are in place to ensure that any amounts which are paid out are treated correctly for tax and NI purposes?

Quite right too.

Rumour has it there’s not just smoke in this case, but a fire too. And tackling such issues in such a high profile way is wholly appropriate.

And there’s muchmorein thearticlethan the bits I’ve noted.

The following statement was issued by the Dean and Chapter of St Paul’s Cathedral this morning:

The Dean & Chapter of St Pauls Cathedral issued the following statement this morning (Monday 17th October):

“Services at St Pauls Cathedral were able to take place as normal this weekend but the last few days have not been without various challenges. Our chief concern is that St Pauls be allowed to operate as normally as possible and for all people to be respectful of this need.

Public safety has been a major concern. We have been in constant touch with the police and community leaders. As the City of London returns to work this morning we are monitoring the situation carefully.

On Sunday the protestors did reduce their presence on the landing and steps of the West Doors enough to allow people to come in to worship throughout the day.

It is also now important that the thousands of visitors wishing to visit the cathedral and to enjoy our hospitality this week are able to do so freely and that the daily life of St Pauls Cathedral can continue without serious interruption.”

It’s an extraordinary comment to issue. What’s important to them? That the Cathedral can carry in as normal. What does that really mean? That its turnstiles can continue to take the money. That is what that statement really means. This, as they make very clear, is their chief concern.

Any mention of the poor and those protesting on their behalf? No, none at all. Any Christian message at all? No, none. Just a wish that things carry on as normal and the cash keeps flowing.

That’s appalling. And what it confirms is that they really do think two things. The first is that their neighbours in the City have no questions to answer. The second is that the prime concern of the Dean and Chapter is running a tourist attraction.

Shame on them.

The Belfast Telegraph featured an article yesterday where a KPMG partner in Belfast argued Ireland will never give up its low tax rate whatever Merkel and Sarkozy say and that Northern Ireland’s tax rate must be cut as soon as possible.

KPMG are heavily invested in the plan to makeNorthernIrelanda taxhavenso I am not surprised by the comments. They are, ofcourse, amongst the very few who would gainfromthis plan which would be massively onerous for the ordinary people ofNorthernIreland.

In response the Belfast Telegraph reported:

But anti-poverty campaigner and blogger Richard Murphy said that harmonisation was “inevitable” and called for Ireland to “stop looting other European economies”.

“There is no way this tax competition can continue while the Eurozone is so desperate for cash, it is now not a case of ‘if’ but ‘when’,” he said.

“Ireland will be picked on, it can bluster all it likes but harmonisation will happen. We must question why Northern Ireland is so desperate to copy a system that is doomed to fail and does not work.

“Ireland has already had preferential treatment, it is time for Ireland to grow up and play its part in the international economy and to stop looting other European economies.”

Thataboutsums it up.

The EU thinks it’s saved the Euro, again.

It hasn’t.

This is a deal, summarised here, that to coin the current vernacular, kicks the eurodownthe road until the autumn, but which has no hope of delivering a real solution.

Why not?

Because, clause 1, no one knows if the Greek people will, as yet, put up with the austerity that is demanded of them. But what we can say with certainty is that the austerity demanded will not deliver growth, whatever this document claims.

Because, clause 2, no one has worked out whether the EFSF can pay for this deal.

Because, clause 2, the IMF may not agree that the deal.

Because, clause 4, Germany may not in the end cough up enough cash to reflate the Greek economy, and even if it does, Portugal, Ireland, Spain and Italy need the same deal, and aren’t going to get it. The awareness that a Keynesian solution is needed is hinted at in this clause, and then firmly run away from.

Because, clause 5, when it comes down to it the private financial sector will prevaricate, arbitrage, delay and generally obstruct any deal, seeking better advantage for themselves over all others who might participate, and that will mean that this provision will fail to deliver.

Because, clause 6, Greece is not an exception and ignoring that fact means that clause 7 isfarcical: anyone who believes that the Irish government is going to pay in full debt that is beyond any imagination that it can settle is naive in the extreme: those signing this deal were.

Because, clause 8, this requires fiscal union and a fundamental reform the way in which the European Central Bank works, and getting agreement on that after the heat of the moment is very unlikely;

Because, clause 9, the Germans aren’t going to guarantee other euro states debts forever;

Because, clause 10, the Irish will try to renege, for all their worth, making a deal on tax;

Because, clause 11, reducing deficits to 3% of GDP is going to result in mass poverty, the destruction of welfare, the ending of healthcare provision, misery in old age, massive destruction of the state in Europe, and in turn the destruction of GDP itself. A commitment to the economics of the madhouse destroys the credibility of this agreement: only a Keynesian solution can solve Europe’s crisis now, and this clause commits Europe to poverty. Clause 12 does not change that. The democratically elected governments in Europe will reject this package: their electorates will demand that they do so.

Because, clause 13, creating an economic police to impose the straitjacket will not make it work;

Because, clause 14, reaffirming neoliberal economic policies is equivalent to signing a Euro suicide note;

Becauseclause 15, you can’t tell banks how to rate their loan books – unfortunately;

Because, clause 16, by the time we get to October all these weaknesses will be apparent.

And yet, I admit, all of those are just detail.

At its core this deal does not work for a number of much more fundamental reasons. The first is the euro itself cannot work: even with massive fiscal reallocation of wealth within the Eurozone the stress would remain too great: these economies are too disparate to have one currency.

Then there is the fact that, like it or not, , Ireland, Portugal, and almost certainly Spain if not Italy, add debts that they cannot support and therefore, like it or not, European banks holding those debts are at serious threat of insolvency. This deal does nothing to address that issue.

Just as this deal does nothing to really stimulate growth: it recognises that without growth Greece cannot repay its debts and yet the rest of Europe it demands cuts in government spending that can only result in a move towards stagnation or recession across Europe as a whole for decades to come.

In other words, this is a fundamentally flawed deal, and the flaw can be simply identified: it is that this deal puts the stability of money above the importance of real economic activity that generates wealth for the people of Europe. This is about bankers, yet again, and not about putting food on the table. This is about preserving wealth and not about creating prosperity. This is about maintaining division, but not about delivering hope.

And because it fails to address any of those issues, this deal will fail.

Only when we take on the banks; only when we realise that real wealth is based upon the full employment of well-paid people and only when we realise that it is the duty of governments to deliver hope can we go forward. This deal doesn’t do that, which is why the next version will be negotiated soon.

As the Guardian reports:

Britain’s largest companies are in dispute with HM Revenue & Customs over paying 25bn worth of tax, according to the latest official figures.

The money, if collected, would go a long way to helping the government’s parlous financial state and is, for example, roughly equivalent to the size of a year’s cuts to public spending.

The new figures have been disclosed as the Whitehall watchdog, the National Audit Office, is scrutinising controversial tax deals struck by HMRC with multi-nationals following the row overVodafone‘s 1.2bn settlement with the taxman.

The Revenue is involved in 2,721 disputes with the country’s biggest businesses, according to the figures disclosed under the freedom of information legislation. They cover all taxes ranging from corporation tax to specific taxes such as the petroleum revenue tax and insurance premium tax. The oldest dispute goes back to 1990, although most are recent, according to the Revenue.

I have two reactions to this news.

The first is that it supports the claim that I have long made that tax avoidance by large UK multinational companies amounts to at least 12 billion a year. This estimate was made in The Missing Billions, which I wrote for the TUC.

Now of course the figures are not the same. The Revenue statistic is, I presume, the total tax in dispute now, and as is noted some goes back a long time. My estimate was the annual loss. But the Revenue figure misses out vast amounts of tax avoidance. For example, thearrangementswith Google which cost the UK hundreds of millions in lost tax a year are obviously tax avoidance, but seem acceptable to HMRC. Many multinationals do the same sort of thing. These aren’t in the HMRC total and are in mine.

And the Revenue data assumes, of course, that they’ve identified all avoidance and have challenged all they have identified. That’s very unlikely, indeed.

Take these factors into account and I think the HMRC estimate does three further things. The first is that it suggests my estimate remains a reasonable, if not cautious estimate, of this loss. Second, it suggests that HMRC’s own estimate for the total annual cost of this activity at 2.9 billion is ludicrously low and third it says there is a need for a radical review of what HMRC is recording and doing in this area.

But ultimately, and this is my obvious second reaction to this news, the issue is that this loss, which is at most only 10% of my estimate of total tax gap, is serious, and has the potential to radically transform thegovernment’sfiances and the need for cuts.

And yet despite that the government is cutting the number of staff dedicated to this task.

And it is therefore reducing the prospects of recovering this money.

It’s sending out as a result an unambiguous message that it does not want to collect tax due from the tax avoiders and tax criminals in this country.

Why don’t the government want that money?

Why do they want to cut pensions, the health service, education, benefits, the police, fire service, welfare services, careprovision for the elderly and so much else instead?

Why do the government believe that the cheats and crooks of this country are so much more important, and so much more deserving of money than those in real need?

Why, George Osborne? Please tell us.