What do Take That, Jimmy Carr, Starbucks and Amazon all have in common?
Each of them has been in the news in relation to the use of “aggressive” tax avoidance schemes.
Why is tax avoidance important?
Tax is used by tax jurisdictions to collect funds to pay for essential public services. If individuals and companies do not pay their share of tax in a country, then someone else will have to.
Who is affected by it?
Everyone. Governments may have to meet the shortfall through expensive borrowing. Charities are involved in assisting those who suffer most: the poor; those who rely on public services; and this is even more important in developing countries.
Businesses will have their reputations affected and customers may be lost. National Governments want their share of the world-wide tax “pie” and organisations, such as the G8 and the OECD want to eliminate unfair competition due to differences in domestic tax rules.
Indeed. Accountants are often blamed for advising clients on how to avoid paying taxes , but in most cases are not breaking any laws - it is the ethical and moral issues that the media are against.
How can I find out more?
Easy, just type “aggressive tax avoidance” into Google and read from the vast quantity of hits it returns. Or take the Taxation or International Taxation modules!