Lower energy bills to be paid for by crackdown on Tax Avoidance

[WallBuilder]

One thing that has started to irritate me is the figure being bandied about by the media giving a number for people who died because of cold related issues. Now this is in the same item as the cost of heating and yet the figure is not just for the numbers who have died because of the lack of heating. which is not made very clear.

[Penistone999]

Presumably by closing some of the existing "loopholes".

 

Good accountants can always find away around this.

[Longcol]

Good accountants can always find away around this.

 

Depends - and it is tax lawyers not accountants that find the loopholes in most cases.

[Cyclone]

Right on cue.

 

Let's do the ISA argument thingy

It's hard to resist when you start with the insults before anyone has even made the point that you're totally and completely wrong.

[erebus]

It's another blatant lie, as they should look into the tax avoidance the energy companies already use, legal of course to low or no tax jurisdictions.

 

Centrica for instance has 15 Uk registered subsidiaries as well as operations in the Netherlands, Canada and the US through which it trades energy to itself, as well as leasing gas powered power stations to its parent company, which then sells the power back on fixed contracts. Such arrangements reduce tax. Let us not forget gas storage, which is also another side of actual inside trading in which a company forms a group of satellite companies to trade with itself. All totally legal.

 

Which this sort of tax dodge, employed by many large corporate bodies, bonuses and profits abound, and tax itself evaporates. This is what privatisation is and was always about. Taking money from the public sector and putting in the pockets of the few private corporations.

 

This is an outline of how such scams work, and its all legal.

 

Its like having an apple tree and people want the apples which are sold ina shop owned by the family who has the tree.

 

A child is employed to climb and pick the apples who sells the apples to his sister, who pays cash and takes them into he house, where she pays a fee for storage. To the storage fee is added the cost of transportation to the cellar. The apples are then transferred to the car, which is another fee, and the car takes the apples to town, which also costs for driver, mechanical wear, fuel and others extras. Arriving at the shop someone carries the apples into the shop, another fee, and the apples are then put on display, another fee, plus storage of extra apples. To this the cost of running a shop and employees are added, and the person who buys the apples, pays for all these costs, plus a small profit added all through the process. This is now the power companies operate, and costs to the customers are kept at 4-5% profits for the energy companies.

 

So this method allows corporate chiefs to bleat they make a small profit on the distribution side, and display crocodile tears of narrow margins. So where is all the profit? All in house of course, as charity begins at home innit?

[I1L2T3]

It's hard to resist when you start with the insults before anyone has even made the point that you're totally and completely wrong.

 

I was heading it off

 

The ISA argument is one of your little favourites IIRC. And you showed up really quick too. Much quicker than I expected.

 

---------- Post added 01-12-2013 at 19:07 ----------

 

One thing that has started to irritate me is the figure being bandied about by the media giving a number for people who died because of cold related issues. Now this is in the same item as the cost of heating and yet the figure is not just for the numbers who have died because of the lack of heating. which is not made very clear.

 

A bit off topic, but there are illnesses made worse by the cold. Some people who have the illnesses are on low incomes. Some people on low incomes can't afford to heat their homes.

 

If you were drawing a Venn diagram you would get intersections between the different groups and you would have some people with chronic illnesses on low incomes having problems heating their homes. Or are you arguing that wouldn't happen? Or just that you don't know specifically how many people are affected?

[Obelix]

 

Cue some total prat to try and argue it's all OK because the 99% are allowed to have ISAs.

 

Translation: I don't have any way of refuting the fact that ordinary people can have tax avoiding ISA's, so I'll get some pre-emptive abuse in to deflect people and try and smear it good in advance.

 

Right?

 

Right.

[I1L2T3]

Translation: I don't have any way of refuting the fact that ordinary people can have tax avoiding ISA's, so I'll get some pre-emptive abuse in to deflect people and try and smear it good in advance.

 

Right?

 

Right.

 

Haha, nope. But nice try.

 

I know people can pay less tax by having an ISA, getting tax relief on pensions etc... I do it. I do it deliberately.

 

But that does not mean I am the same as an aggressively tax avoiding corporation. Or the likes of individuals like Jimmy Carr.

 

Do you understand fundamentally why it's not the same?

[Obelix]

Haha, nope. But nice try.

 

I know people can pay less tax by having an ISA, getting tax relief on pensions etc... I do it. I do it deliberately.

 

Welcome to legal tax avoidance.

 

But that does not mean I am the same as an aggressively tax avoiding corporation. Or the likes of individuals like Jimmy Carr.

 

Just keep telling yourself that if it makes you feel better.

 

Do you understand fundamentally why it's not the same?

 

No. Because it *is* the same. It's legal and permitted by law until legislated otherwise.

[I1L2T3]

Welcome to legal tax avoidance.

 

 

 

Just keep telling yourself that if it makes you feel better.

 

 

 

No. Because it *is* the same. It's legal and permitted by law until legislated otherwise.

 

Now we're getting somewhere.

 

Tax breaks on ISAs, pensions etc... are deliberately legislated for because the government wants and expects you to use them. The effects of this are expected to be economically beneficial.

 

Aggressive tax avoidance utilises loopholes in tax law that were never intended to be used. The effects can be economically destructive.

 

The only thing that links the two is legality, but in the latter the foundations for that legality are often shaky. And in many cases, when the HMRC manages to extract its head from its jacksy, are retrospectively deemed illegal.

 

I don't expect ISAs or stakeholder pensions to be declared illegal any time soon. Do you?