Not making sense: Culture Secretary Nadine Dorries has been telling us that Channel 4 must be sold because it is not making enough in advertising revenue – but it is in fact making record profits. Confronted with that fact, she said that means now is a good time to sell it. So it IS all about making money, then!
Culture Secretary Nadine Dorries has come badly unstuck on her reasons for selling Channel 4.
Giving evidence to the Commons Culture Committee on Thursday (May 19), she said Channel 4 is dependent on just one stream of revenue – advertising – but income is falling as advertisers have more choice. She claimed Netflix would be a better option.
And the government cannot allow Channel 4 to borrow to invest, because the taxpayer would be liable for those debts, she said. This actually does make sense of one of the restrictions on the channel’s funding.
But later in the session, the SNP’s John Nicolson pointed out that Channel 4 is currently making record profits – belying what Dorries has been saying about advertising revenue.
Her response?
“That means it would be a good time to sell.”
This is a woman who – like the character Eccles in The Goon Show – refuses to be defeated by logic.
If someone tried to make her understand how gravity works, we may reasonably expect her to say – like Eccles did – that she stays on the ground because she lives there.
What a goon.
And her answer reveals that this sale is not about what’s best for Channel 4.
It’s about making fast money for a spendthrift government.
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Prophetic: I made this infographic in December 2020 – almost a year ago.
Remember when David Cameron – the architect of the EU membership referendum – said his Conservative-led government would ‘slash red tape’?
It’s almost funny, with hindsight.
Today we learned that the departure from the European Union that his referendum triggered has resulted in a loss of £17 billion in revenue to UK businesses, while they have been swamped in a quagmire of red tape that Brexit has created.
According to The London Economic:
Despite promises from the Leave campaign that red tape would fade after Britain quit the EU, UK companies have had to fill in an astonishing 48 million customs declarations and 140,000 export health certificates in the eight months since the UK quit the single market and customs union , according to the National Audit Office (NAO).
The NAO blamed Brexit for a sharp decline in trade between the UK and EU this year. “Total trade in goods between the UK and EU was 15 per cent (£17bn) less in Quarter 2 when compared with the equivalent quarter in 2018,” the watchdog’s report said.
An additional £600 million in costs has hit British importers since January according to HMRC data seen by The Guardian. The cause has been identified as Brexit, because the taxes were not required for EU imports when the Britain was in the single market.
But isn’t that the exact opposite of what Boris Johnson promised? Didn’t he say there would be no barriers to trade after Brexit?
Why, yes – yes he did:
Today we learn Brexit red tape has slashed £17 billion from UK trade with the EU in just three months as businesses struggle to keep up with new costs
Here is Boris Johnson selling his “oven ready” deal on the absolute promise there would be NO non-tariff barriers to trade! https://t.co/d9wVWHlZRF
It turned out that these rules and regulations were necessary to keep us safe and secure in our workplaces and financial transactions. I’m sure you can think of your own examples.
Their loss has endangered us.
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It was revealed over the weekend that staff at HM Revenue and Customs are to receive a 13 per cent pay rise. We already know NHS staff will get only one per cent.
Some commentators have insisted that we should not begrudge tax inspectors their pay rise but I am not one of them, because I have recent experience of their work.
I file my tax returns online, you see.
When I did it this year, the automatic system demanded that I pay half the amount again, as a down-payment on next year’s taxes – but I declined on the basis that the Covid crisis has hit my income to the point where I’m unlikely to hit the threshold for paying income tax at all.
The response was that this would be considered and I would be contacted later.
I had that contact last week. After I fished it out of my email system’s spam folder, it instructed me to visit the HMRC element of the gov.uk website.
This meant I had to provide a numerical code and a password, which I did.
Then I was told a further six-digit passcode had been transmitted to my mobile phone, and I had to look it up and input that as well.
Then I was told I would be asked further questions on two of three subjects (the choice being mine). One of them was a non-starter because it didn’t apply to me, and the first of the other two required me to provide “0” as an answer, which HMRC’s website doesn’t allow.
So I could not retrieve my message. I’ve informed HMRC and am awaiting its response. This may take some time.
All I want to do is pay my taxes and the system is holding me up. For this, HMRC staff will receive a 13 per cent pay increase over the next three years.
If I go to my local doctor with a health problem, I can be assured of instant attention. If the problem turns out to be serious, that attention may involve being ambulanced to hospital for the immediate attention of specialists in their field. For this, NHS staff will receive only a one per cent pay increase.
You can appreciate my reasons for begrudging HMRC staff their increase, I hope.
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It was headed “2021 Reimbursement/Ref HM05012021 Payment confirmation” and stated that I needed to go to the “HMRC Online Payments website” in order to receive £520.99.
I never clicked on the link. If HMRC is running a website called timeless-sunsets.com then I am Rishi Sunak!
A wave of scam text messages are being received across the UK, potentially duping people into giving up their card details in order to claim a non-existent government grant.
The scam has been quickly designed to take advantage of confusion following yesterday’s announcement of another national lockdown due to the coronavirus pandemic.
But there are a number of signals in the text message, including grammar and spelling errors despite claiming to be sent from HM Revenue and Customs, that can alert people to the fraud.
An HMRC spokesperson said: “HMRC will never offer a tax refund by text, email or phone. One way to check whether you are due a rebate is to log into your Personal Tax Account.”
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HMRC: if you have a Covid-19 test, the government will tax you for it.
Just when you think the Tories are as low as they can go, they find a new way to disappoint.
HMRC has confirmed that Coronavirus tests are to be treated as a “benefit in kind” and that every employee who takes one as part of their job will be taxed for it:
HMRC yesterday confirmed workers who have a Coronavirus test from employer as part of their job will see it treated as a 'benefit in kind' and thus be taxed on it (& see take home pay reduced)
Delighted to see the Treasury Select Committee are taking this up with the chancellor.
Some of us should be tested regularly because our jobs involve regular contact with large numbers of people.
Consider the doctors and nurses who have saved so many lives already, for example.
Do you think they should be penalised, simply because the nature of their work – saving lives – requires them to take these tests?
It won’t be a step too far because British people are notorious wimps when such impositions are made on their working pay and conditions.
But if you are affected, you should be downing tools and demanding that this decision be refused, and if you aren’t, you should be downing tools in solidarity. This is an attack on all of us.
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How sympathetic of our tax guardians! And if I get caught evading my tax responsibilities, will I receive the same treatment?
No?
Then this is unfair and must end.
It also seems contradictory. Look:
A senior HMRC official admitted that the UK tax authority panders to the rich and powerful when chasing them for tax evasion so they can avoid “reputational damage“.
If you ever had any doubt that in Britain there really is “one rule for them, and another for the rest of us“, this utterly astonishing admission by the UK’s tax authority proves it.
Richard Las, a deputy director of HMRC, said that criminal prosecutions are not the “default option” for cases of tax evasion, money laundering or fraud. He went on to say:
“When deciding whether to deploy our resources, we try to understand what motivates different types of offenders. For example some tax offenders are very wealthy, prominent members of the community. We know that these types of people do not want the reputational damage of custodial sentences, and we can use that to our advantage.”
I could understand this strategy if it resulted in a larger repayment to the Treasury, but the evidence indicates that it does not.
Can HMRC point to anyone who has paid more back to the state as a result of the organisation using the threat of reputational damage “to our advantage”? No – because that would make the whole exercise pointless.
And consider this: Is HMRC admitting it blackmails the rich?
The more one thinks about the HMRC statement, the less credible it seems.
This government department is apparently admitting blackmailing rich people with the threat of reputational damage if they don’t pay up – but we have no evidence to show that they have paid everything they owe.
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All you have to do is look at the list of beneficiaries from this proposed law change. None of them are short of a few pennies.
And how many are looking forward to cashing in on Brexit?
Brexit-backing MPs as well as counterparts from the remain campaign have backed a controversial measure to extend a tax break to referendum campaign donors, after several billionaire donors received large demands from HMRC.
The shadow chief secretary to the Treasury, Peter Dowd, criticised the proposed amendment to the finance bill from prominent leave campaigners Charlie Elphicke, Jacob Rees-Mogg and Iain Duncan Smith, but which has also been backed by Labour MPs and remain supporters Alison McGovern and Caroline Flint.
It would extend a tax exemption for political parties to referendum campaigns – backdating it to cover the EU referendum.
Last month it was revealed that several prominent leave campaigners who donated large sums to the Brexit campaigns during the 2016 referendum received substantial tax demands from HMRC.
HMRC said it had applied the law equally across all donors, but senior UK cabinet ministers Boris Johnson and Michael Gove expressed concerns about the demands.
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Isn’t it interesting – some would say fortunate for the Conservatives and their tax avoiding friends – that HM Revenue and Customs don’t seem to have enough staff and resources to investigate the Paradise Papers revelations properly?
The Tories have been cutting Civil Service number wholesale since they came into office in 2010. As the graph (above) shows, the number of staff in HMRC was cut by one-third between 2005 and 2014. It should be admitted that New Labour was in office for the first five years of this period.
Current staffing at HMRC is 60,579, according to UK government figures.
Those staff members are implementing Brexit changes and 15 major programmes already – and must now attempt to add investigating the facts in the Paradise Papers to their duties.
Is it too much?
If the workload is too great, HMRC bosses must face the possibilities that mistakes will be made – unless they decide to concentrate on some projects and exclude others, or take on more staff.
This Writer would suggest that a Tory government is unlikely to take on any more staff!
And no minister would want to admit having pushed ahead with projects, knowing that they were likely to be flawed.
That leaves us with the possibility that some projects will be dropped.
Will the Tories want to drop programmes it has initiated? This seems unlikely.
But shelving an investigation that involves 13.4 million files? Into tax avoidance?
Let us be honest: Tories resent the national assumption that the rich must pay taxes along with everyone else – and must put a higher proportion of their earnings towards those taxes. They assume the poor are more likely to use publicly-funded services, and should therefore pay for them; if those services prove too expensive, then the poor should do without them.
It is an assumption that avoids inconvenient truths, like the fact that we all use some publicly-provided services – rich and poor alike. Our network of public roads is an example that springs to mind.
So it seems likely – to me – that the Tories will find it very easy to delay – perhaps forever – any investigation into tax avoidance, especially one that could implicate members of the Conservative Party, donors to the Conservative Party, or others whose exposure would prove an embarrassment to the Conservative government.
Time will tell if I am proved correct.
HM Revenue and Customs is struggling to cope with a growing workload, including investigating revelations contained within the Paradise Papers, according to parliament’s spending watchdog.
The public accounts committee has warned that it is “far from confident” that the tax authority has sufficient resources to scrutinise claims published in the Guardian last year arising from a leak of 13.4m files.
In a report released on Thursday, MPs concluded that the Paradise Papers leak had highlighted the “potentially dubious practices of many high-profile individuals and corporations” that use offshore tax havens.
The committee said the tax authority was having to make tough decisions about the allocation of its own resources, while implementing Brexit changes and 15 major programmes across government.
The tax authority has until April to outline how it plans to cope with the growing pressures on HMRC.
Meg Hillier, the chair of the committee, said that HMRC’s “high-wire act” is facing “potentially catastrophic consequences” for taking on too many tasks at the same time.”
She added: “HMRC accepts something has to give and it now faces difficult decisions on how best to use its limited resources – decisions that must give full consideration to the needs of all taxpayers.”
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A specialist team at HM Revenue & Customs is examining the tax affairs of 6,500 super-rich individuals [Image: Alamy].
… And the story doesn’t say whether the prosecution was successful.
This revelation will certainly re-kindle claims that HMRC is concentrating far too much of its effort on tax avoidance among working- and middle-class people when it should be putting resources elsewhere.
But the simple fact is that it is easier to detect tax avoidance among the less wealthy classes – because they don’t enjoy as many – legal – opportunities for avoidance.
This is a story about corruption in Parliament, where super-rich MPs simply won’t simplify tax in a way that might disadvantage themselves. Or so it seems to This Writer.
Still, it is welcome to see that 40 of the people named in the Panama Papers are now under investigation.
Is it forlorn to hope that one of them is David Cameron?
Tax inspectors targeting Britain’s wealthiest people have identified potential evasion and avoidance worth nearly £2bn, but have pursued only one successful criminal prosecution, a National Audit Office report reveals.
It says the tax affairs of 6,500 super-rich individuals – each worth more than £20m – are being examined by a specialist HM Revenue and Customs unit. The unit is investigating outstanding receipts worth £1.9bn, a majority of which involve aggressive avoidance schemes.
However, just two individuals have been criminally investigated over the past five years, leading to a single prosecution, while another 70 were pursued through the civil courts.
In an indication of the scale of the task faced by the unit, the report discloses that each of the 6,500 super-rich taxpayers has had on average four serious tax issues looked at by the unit. Around 4,000 inquiries have been open for more than three years, it adds.
The report sheds a light on the scale of potential tax avoidance involving the super-rich and will prompt further claims that Britain’s wealthiest people are not being pursued with the same vigour as benefits claimants or small businesses.
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George Osborne’s most famous performance in Prime Minister’s Questions, from November 2014. What was he on?
George Gideon Osborne. Was there ever a more foolish fellow running the Exchequer?
Probably not. Did you hear him in Prime Minister’s Questions yesterday, trying to tell us that the UK’s social security bill makes up seven per cent of welfare in the whole world, and that this is “unsustainable”? What a berk.
The first question this raises is, can he prove his “seven per cent” claim?
No – he’s wrong. The claim is based on a comment by German Chancellor Angela Merkel about EU social security being 50 per cent of that in the world, making the UK’s share 7.4 per cent of the total. Unfortunately for Thick George, she was using World Bank data that only included 96 countries and excluded large economies like Canada and Mexico, where social security makes up 18 per cent and 17 per cent of each country’s GDP.
The Guardianreckons that, if all countries were taken into account, this would not seriously affect the UK’s share of the total, suggesting that it accounts for the rounding-down to seven per cent from 7.4 – but there’s no proof either way. The article also quibbles about definitions of social security spending.
What this really shows is not that the UK spends too much, but that other countries spend too little.Mr
Nearly half of the world’s population – three billion people – must try to scrape a living on around $2.50US per day – or less. Of those, 1.3 billion are in extreme poverty, having to survive on less than $1.25 per day. That’s around 80p.
The countries in which they live – mostly developing countries – don’t have social security at all; that is the scandal.
If they did, then Gideon could not quote his “seven per cent” figure – it would be much lower.
What’s stopping these developing countries? Well, the organisation most directly responsible is probably the International Monetary Fund, whose ‘Structural Adjustment Programmes’ have put these countries into a continual cycle of debt; they can’t help their populations without breaching the IMF’s rules. This is the same IMF that wants the UK to run a debt economy, by the way.
So much for Osborne’s claim that social security spending in the UK is too large a proportion of the world’s spend. What about his “unsustainable” comment?
He said: “We can either carry on on a completely unsustainable path or we can continue to reform welfare so that work pays and we give a fair deal to those on welfare and indeed a fair deal to the people, the taxpayers of this country, who pay for it.”
Ignoring for the moment the fact that those on social security are in fact taxpayers themselves, let us consider the fact that the UK government does not collect as much tax as it could, and in fact offers extremely lucrative tax avoidance opportunities to the obscenely wealthy.
Did you know that you could fit the owners of half the world’s wealth into a double-decker bus, with space to spare? Less than 80 people own more money than the other seven billion, and you can bet that the majority of those with UK citizenship aren’t paying their full whack of tax!
A report by Tax Research UK has indicated that the amount of tax being avoided is around £122 billion every year. Compare that with the UK’s current budget deficit of £107 billion per year and you will see that – in a perfect world in which it was all collected – we would be running surpluses of at least £15 billion per year.
The Conservative government, of which Osborne is Chancellor, tells us the most effective way of tackling the deficit is by cutting the public services on which many people rely. They say it is the only option without increasing taxes.
But, with more than £100 billion in taxes going uncollected, why is the government slashing funding to the HMRC investigative branch?
Over on Tax Research UK itself, Richard Murphy has taken David Gauke, the financial secretary to the Treasury, to task over his fudged claims about the tax gap.
Gauke said: “The tax gap as a percentage has been lower in every year under us than it was in any year under the Labour Government”.
Mr Murphy replied: “Percentages are the evasive politician’s favourite tool, so I think that claim can be dismissed. What remains baffling is David Gauke’s apparent inability to see just how wrong his data might be. The government claims that the tax gap is £34 billion. And then it claims that HMRC recover £26 billion a year. Or to put it another way, £60 billion of tax abuse is attempted and 40 per cent is recovered.
“Is there anyone who thinks that remotely likely?”
He goes on to completely trash Gauke’s – and the Conservative Government’s – claims, and it is strongly recommended that you read the article for the details.
Mr Murphy says HMRC’s tax gap estimates should be subject to independent economic audit to check their credibility. He says HMRC’s claim of tax recovered should be subject to independent scrutiny to ensure that it is credible. He says a review of HMRC is overdue, with a panel of independent experts including from unions and civil society being included in the task. And he says it is time we had an Office for Tax Responsibility, reporting to the Public Accounts Committee, to ensure that this most critical department of government is held to account.
He states: “A recovery of £26 billion out of more than £100 billion I could possibly accept – except to say it could be so much better. But that rate of recovery out of anything less is absurd right now – as is HMRC’s tax gap estimate.”
So, under analysis, Gideon the Towel Folder’s claims are no more than silly attempts to confuse us.
If he bothered to collect all the taxes owed him, he would be running a budget surplus tomorrow.
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