Taxing questions (From York Press)

Taxing questions

9:38am Wednesday 17th October 2012 in Letters By Readers' letters

THE repeated objections to foreign aid on the Letters page suggest that Tom Mitchell (Foreign Aid Fears, October 15) speaks for many.

It would indeed be interesting to know why British governments choose to give, as aid, money raised from citizens who actually pay tax, instead of recovering and using the tax due from companies and individuals, who cynically play the system so as to avoid paying their share of tax.

Apart from the substantial tax revenue lost by tax avoidance in this country, the taxes deliberately and blatantly evaded by global companies and funds operating in developing countries far exceed the foreign aid those countries receive. To our shame, a majority of the tax havens used by those seemingly without basic moral principles are situated in present and past British dependencies.

If British politicians had the will to act, the need for foreign aid to compensate for the tax developing countries are cheated out of would disappear. There would still be a need for aid to provide relief in cases of natural and man-made disasters, but the response to disaster funds shows that no one is against that.

Maurice Vassie, Chair, Christian Aid York, Deighton, York.

• WHEN is the Government going to act to prevent multinational corporations such as Amazon from destroying our high streets while paying no tax?

Amazon’s accounts for 2010 show that its offices in Luxembourg employed 134 people who generated a turnover of £6.5 billion.

By contrast, their operation in the UK that year is listed as employing 2,265 people and reported a turnover of £147 million. Amazon’s UK sales in 2010 were between £2.3 billion and £3.2 billion. They paid almost no tax.

The net result of Amazon paying little or no tax is that can undercut every shop on the high street.

On their ebooks, for example, they pay only three per cent VAT instead of 20 per cent because they moved their headquarters to Luxembourg.

How are British businesses meant to compete?

Amazon is not alone. The Daily Mail reported earlier this year that Google, tax resident in Ireland, recently paid £5.1 million of UK tax on sales of £2.1 billion. That works out at 0.25 per cent tax.

What is George Osborne doing about this? Osborne was happy to hobnob with Google earlier this year, while simultaneously treating us to lectures about “a culture of entitlement” and how he finds tax avoidance “morally repugnant”.

Christian Vassie, Blake Court, Wheldrake, York.