What's Ireland got to do with the U.K. tax rates?

Chancellor lowers one tax rate here, has to cut costs or increase other taxes.
There's no escaping that.
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Ireland are in the EU, and a lower corporate tax rate has encouraged business to set up there. Much to other EU states annoyance.
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Ireland had to do so in order to attract businesses there.

Chancellor cutting corporation tax is to serve as an incentive to KEEP company operations in the UK. Hoping therefore that a slight percentage difference between us and Ireland will be negligible.

All this will amount to reduced tax revenue - this is unavoidable.
Why would businesses leave mainland Europe, if their operations are based on mainland Europe characteristics to set up in Brexit Britain? They wouldn't do.

Thereby the move by the chancellor to cut corporation tax to 15% is to mitigate instances of companies leaving.
This may not stop all this movement, so that movement added to the 15% corp tax will result in less revenue.

If you think there will be more revenue due to this you are seriously mistaken.

Thereby there will be a revenue shortfall to take care of, what does the chancellor choose, raising other taxes or reducing services?

Note it is a tory government, with a penchant for privatisation.

On Leadsome dropping out of the race - I am very sceptical.. I think the door is back open for Gove.

Remember his missus saying he has the backing of Murdoch and Dacre

Then we had IDS recently saying there's a black ops (via the press) against Leadsome

Wouldn't surprise me to see Gove back in the motions, with the tabloids etc then heavily backing him prior to the members vote.

After the last couple of weeks - this would not surprise me one bit.

I'm no Tory but at least we will have a smooth coronation regards the new PM, rather than a protracted process lasting a couple of months. A power vacuum just leads to more uncertainty.

ok looks like it will be a coronation of Theresa May...

.. she will pick and choose her moment of doing this.

All this will amount to reduced tax revenue - this is unavoidable.
Why would businesses leave mainland Europe, if their operations are based on mainland Europe characteristics to set up in Brexit Britain? They wouldn't do.

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If we are out of the single market, companies such as Amazon may have to set up a proper operation here. They would not be able to use Luxembourg as their proxy as we are out of the EU.

If Amazon wanted to do business here - and they will as we make up 1/3 of their EU turnover - we could make them pay more tax here rather then their Luxembourg bolthole.

This is a bargaining chip for access to the single market, make no mistake about it

Comment deleted by Site Moderator

comment by HRH King Ledley (U20095)
posted 5 minutes ago
All this will amount to reduced tax revenue - this is unavoidable.
Why would businesses leave mainland Europe, if their operations are based on mainland Europe characteristics to set up in Brexit Britain? They wouldn't do.

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If we are out of the single market, companies such as Amazon may have to set up a proper operation here. They would not be able to use Luxembourg as their proxy as we are out of the EU.

If Amazon wanted to do business here - and they will as we make up 1/3 of their EU turnover - we could make them pay more tax here rather then their Luxembourg bolthole.

This is a bargaining chip for access to the single market, make no mistake about it
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Not going to happen when there tax havens within the UK'so own crown dependency.

Gove is 332/1 on Betfair.

May 1/100

If you have a feeling for Gove stick a bullseye on it

comment by Ross Turnbull has a Champions League medal (U3522)
posted 4 minutes ago
comment by HRH King Ledley (U20095)
posted 5 minutes ago
All this will amount to reduced tax revenue - this is unavoidable.
Why would businesses leave mainland Europe, if their operations are based on mainland Europe characteristics to set up in Brexit Britain? They wouldn't do.

--------------

If we are out of the single market, companies such as Amazon may have to set up a proper operation here. They would not be able to use Luxembourg as their proxy as we are out of the EU.

If Amazon wanted to do business here - and they will as we make up 1/3 of their EU turnover - we could make them pay more tax here rather then their Luxembourg bolthole.

This is a bargaining chip for access to the single market, make no mistake about it
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Not going to happen when there tax havens within the UK'so own crown dependency.
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Such as?

Not being sarcky, I am genuinely unaware

Well worth a quid

Jersey and Guernsey


Pretty much all of their revenue comes from companies escaping UK taxes. Jack Walker stored all his money there before he bought Blackburn Rovers

Even the Isle of Man is something of a tax haven

Gibraltar?

I'm not sure on Gibraltar but I wouldn't be surprised if it was routinely used as well.

What are their corporate tax rates?

Standard rate in Jersey and Guernsey is 0%. Isle of Man is 20% but with a £120,000 cap.

comment by Ross Turnbull has a Champions League medal (U3522)
posted 3 minutes ago
Standard rate in Jersey and Guernsey is 0%. Isle of Man is 20% but with a £120,000 cap.

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£120k cap?

Once out of the EU would the set up change between us and them. Ceasing to be in a single market would surely mean this arrangement could change

There is also no Inheritance tax in any of these places

comment by HRH King Ledley (U20095)
posted less than a minute ago
Once out of the EU would the set up change between us and them. Ceasing to be in a single market would surely mean this arrangement could change


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That is yet to be seen, as members of the Crown dependency, Brexit wouldn't immediately affect their laws or relationship with the UK. Though any attempts to prevent tax avoidance using these islands would likely drive them out of the current set up.

This could well benefit the UK but could also drive more business away. I couldn't say what would happen there.

comment by Ross Turnbull has a Champions League medal (U3522)
posted 54 seconds ago
comment by HRH King Ledley (U20095)
posted less than a minute ago
Once out of the EU would the set up change between us and them. Ceasing to be in a single market would surely mean this arrangement could change


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That is yet to be seen, as members of the Crown dependency, Brexit wouldn't immediately affect their laws or relationship with the UK. Though any attempts to prevent tax avoidance using these islands would likely drive them out of the current set up.

This could well benefit the UK but could also drive more business away. I couldn't say what would happen there.
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To be fair, this is already the set up as it is. They are not planning to do this, they already are.

What is already the set up?

If we are out of the single market, companies such as Amazon may have to set up a proper operation here. They would not be able to use Luxembourg as their proxy as we are out of the EU.

If Amazon wanted to do business here - and they will as we make up 1/3 of their EU turnover - we could make them pay more tax here rather then their Luxembourg bolthole.
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Actually this isn't how it works.. and its not as easy as that.

Amazon in Europe is headquartered in Luxembourg.

All of their sales can be routed through the website in Luxembourg, as far as rules go, that means the sales have been made in Luxembourg, and can be taxed there at the prevailing corporation tax rate.

The operations in the UK and other places, they are standalone businesses. They invoice Amazon Luxembourg for processes they participate in. Whats to stop them invoicing cost + 0.01%? Nothing.

What would happen differently with Brexit? Nothing, as the sales can be routed into one website domain registered in a territory.

This is much different to something like Starbucks where the sales will take place wherever the customer walks into the store.

comment by Redinthehead - FreeGaza - فلسطين (U1860)
posted 1 minute ago
If we are out of the single market, companies such as Amazon may have to set up a proper operation here. They would not be able to use Luxembourg as their proxy as we are out of the EU.

If Amazon wanted to do business here - and they will as we make up 1/3 of their EU turnover - we could make them pay more tax here rather then their Luxembourg bolthole.
-----------------------------
Actually this isn't how it works.. and its not as easy as that.

Amazon in Europe is headquartered in Luxembourg.

All of their sales can be routed through the website in Luxembourg, as far as rules go, that means the sales have been made in Luxembourg, and can be taxed there at the prevailing corporation tax rate.

The operations in the UK and other places, they are standalone businesses. They invoice Amazon Luxembourg for processes they participate in. Whats to stop them invoicing cost + 0.01%? Nothing.

What would happen differently with Brexit? Nothing, as the sales can be routed into one website domain registered in a territory.

This is much different to something like Starbucks where the sales will take place wherever the customer walks into the store.
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That would depend on how we approach it.

As part of the single market goods can travel freely from Luxembourg to here.

But the goods are not kept in Luxembourg, it is a con. The entire operation is in the UK.

Now if we have access to the single market that would be allowed to continue. Which would suit Luxembourg and Ireland for two, as they lean heavily on our economy.

If the EU play hardball they could be added to a number of countries not happy with them come 2017. Elections across Europe, another Greek bailout.

Amazon UK sales are no longer routed to a Luxembourg headquarters. They have a London HQ for that now.