The FT is not where you normally find what the Chief Executive of the Australian Rugby Union would call “a statement of the bleeding obvious”.
Yet Tuesday 2nd June was an exception. The FT had a statement of the bleeding obvious from no less than Dave Hartnett, permanent secretary at the Her Majesty’s Revenue and Customs. He said that fuller, franker disclosure in international tax reporting was: “an idea that is gathering momentum. There is a growing recognition that country-by-country reporting brings additional transparency, particularly in relation to how multinationals are operating in emerging and developing countries.”
Thanks Dave, you don’t need a doctorate to work that one out. Or do you? Depressingly maybe you do.
The FT went on to note that Christian Aid is campaigning on the subject. Apparently the “campaign has bemused many tax experts, who think it is based on poor understanding. One adviser said: ‘I think the corporates are losing the debate because it is so hard to explain.’”
Rubbish!
Corporates are losing because they are not entering a debate at all.
The typical position is one of: “Yes, Chairman I can absolutely assure you that our tax practices are within the rules. We have asked tax consultants. They say it is OK.” Just substitute ‘expenses claims’ for ‘tax practices’ and ‘Fees Office’ for ‘tax consultants’ and quite how threadbare the position is becomes plain.
When ordinary, hard working families’ taxes rise to close the government’s fiscal deficit, tax-secretive companies will be as exposed as an MP with a duck island