Bermuda has received a pair of dishonourable mentions in a “Financial Times” opinion piece on Pay Day — this weekend’s nationwide protest in the UK fuelled by mounting anger over multi-national firms which pay minimal or no taxes in the countries where they do most of their business by reincorporating in off-shore domiciles.
“FT” assistant editor Michael Skapinker said on Monday (Dec. 13) that European and North American companies which legally “dodge the taxman” by exploiting loopholes in their home countries’ tax codes had increasingly become lightning rods for popular unrest among populations in recession-wracked economies like Britain’s. With tax bills going up even while public services are being cut, the British public was in no mood to listen to legal niceties when multi-billion dollar corporations attempted to explain why they aree entitled to try and minimise their tax liabilities
“I suspect that this is what most annoys objectors to companies’ tax arrangements — it is not just that they believe companies are evading their responsibilities at a time when taxpayers face the slashing of their services,” he said. “It is that it all seems so contrived. Ordinary people cannot work in Pittsburgh and pay (or not pay) tax in Bermuda, or live in Birmingham and enjoy Geneva’s tax rates. Why should companies be able to do so?
“Underlying this is one of the oldest business debates. To whom do companies owe their duty? To the society in which they operate or to their shareholders? The latter view has held sway in recent decades, which is why companies have done everything possible to reduce their tax payments.”
In recent weeks protesters have organised sit-ins, pickets and flash mobs against those they accuse of being ”tax dodgers” in the UK. Saturday’s ”Pay Day” is being billed as a day of mass action by organisers.
“One week before Christmas, thousands of people across the country will be hitting the high streets to make sure tax dodgers pay,” they have said in a statement. “Once again we will be targeting multi-nationals and multi-billionaires. They have been shaken up by the protests so far, but on December 18th they will face protests on a scale they could not have imagined just a few months ago … If you’re angry that the government is cutting services for the poorest and most vulnerable whilst letting the rich avoid billions in tax, then please join us, even if you have never been on a protest before.”
Mr. Skapinker said the protestors were enjoying a measure of popular support from middle class Britons unknown in recent decades, a reflection perhaps of growing public exasperation with the legal manoeuvring some corporations engage in to avoid paying their share of the tax bill in their native countries.
“Companies sometimes succumb to pressure,” he said. “(But when) Accenture, the consulting group, decided to moveits official incorporation out of Bermuda, it mentioned negative publicity from being associated with countries that did not have tax treaties with the US. It added that it feared it might struggle to win government contracts. So where did it move to? Delaware? No, Ireland.
“… Companies will probably tough (Pay Day) out. But some of their leaders are in for an uncomfortable ride from an angry populace.”
Bermuda has received a pair of dishonourable mentions in a “Financial Times” opinion piece on Pay Day — this weekend’s nationwide protest in the UK fuelled by mounting anger over multi-national firms which pay minimal or no taxes in the countries where they do most of their business by reincorporating in off-shore domiciles.
