UK firms reveal tax haven subsidiaries
(Mail Online): Hundreds of secret tax haven subsidiaries belonging to major UK companies have been revealed after widespread failures of disclosure in Companies House filings. Fifteen companies – including Marks & Spencer and insurance giant Legal & General – have admitted that they control a total of 568 subsidiaries in secretive locations such as the Cayman Islands and Jersey. The details emerged after the firms resubmitted a list of their subsidiaries to Companies House. The firms acted after being contacted by Financial Mail following a complaint by charity ActionAid and after receiving letters from Companies House.
A spokeswoman for Companies House confirmed that it had contacted-49 firms in the FTSE 100 to warn that failing to disclose makes directors liable for steep fines. Retailer Burberry admits to having seven subsidiaries in Luxembourg, while technology giant Smiths Group has a subsidiary called John Crane Ireland Limited, based in the Cayman Islands. A further 14 companies – including British Airways, cruise giant Carnival and supermarket group Morrisons – were in the process of filing disclosure of their subsidiaries or were at least looking into the issue.
Martin Hearson, tax policy officer at ActionAid, which is dedicated to ending poverty, said: ‘In the future we’d like the government to introduce laws to make companies compile separate accounts for all the countries they work in.’
Category: Business
A jurisdiction that offers lower tax on financial products is just like other countries producing goods at lower costs, like the Chinese in the textile industry and the Japanese with cars. People always want the best value for money. It’s the whole reason why people trade – a capitalist society, I’d say.
A good example why we are better off without Tim Ridley as Cayman’s rent-a-quote service. This is part of a real long term threat to Cayman, as Cayman has the highest stigma value of any OFC. Criticising charities because they are charities is not a legitimate response to this campaign, certainly not from the perspective of the countries in which these organisations operate. Barclays recently announced it would be reducing the number of Cayman companies in the group. Cayman is damaged goods in the world market. We need to accept that before we can engage with anyone. The sort of response below will do more harm than good.
It is ironic that charities such as ActionAid, Oxfam etc are themselves the beneficiaries of two huge tax breaks in the UK that they exploit to the full. First, they themselves are tax exempt in the UK, ie pay no corporation etc tax. Secondly, they benefit from receiving a ‘tax refund" from the UK Revenue on every donation from a UK taxpayer.
The Vatican is another example. It feels quite happy to attack OFC’s. Yet its residents are not subject to Italian tax. And the church is exempt in Italy from any taxes on its huge property holdings.
We must not discount the the good work that charities and churches do. But they would do everyone an even greater service if they focused on those good works and avoided unneccessary and distracting hypocrisy. Matthew 7:5 please!
It’s often hard to tell whether ActionAid are really fighting to eliminate world poverty or just trying to undermine what they see as the capitalist system.
With the tax structure we have in UK many large organisations need every break they can find to survive.
What do Actionaid want to do? Bankrupt the companies they are targeting and put thousands more people out of work?
There are far more serious instances of tax avoidance that need tackling in the UK, offshore entities are just a soft option for them.
So what.