Wednesday, 9 April 2014

We're all in this together! (2)

The Conservatives' slogan The "Big Society" and "We're all in this together." Formed part of his first speech after the election. It was Wednesday 06 October 2010 when Mr Cameron said "This is not a cry for help, but a call to arms. Come on, let's pull together, Let's come together, Let's work together in the national interest. It's about government helping to build a nation of doers and go-getters. It is right that those with broader shoulders bore a larger share of the burden of reducing the deficit, and the Government would always aim to ensure measures to cut spending were fair."

So I thought I would observe things around me. Just to see if we are 'all in this together.' To see if the load has been shouldered by everyone. To see if we have all actually played a part in sharing the burden. Helping to recover the country and improving everyone's living standards. After all, as millionaire David Cameron says, we're all in this together, well we are - aren't we?

Having a mobile phone today is almost a staple of life. Technology has made a phone into a camera, a computer. 2G, 3G and now 4G is almost like an arms race as the Telecom providers go up against each other. Once it was all done on price but now its done on free minutes and free texts. More than anything else its having the fastest network speed and the latest handset. Having the latest handset is as much a status symbol as is a Bullova wristwatch or Ferrari sports car.

Vodafone is a Telecom provider. Vodafone, the world’s second-largest mobile operator by number of subscribers. For more than a decade Vodafone has been trying to avoid paying around £6bn in tax. It was a classic case of using the courts to delay the outcome, in a spiral of case after court case. That was until the tax man eventually won. Vodafone were in serious trouble. There was nothing that the communication giant could do but pay up. A champion was needed - cometh the day cometh the man. The exchequer which is run by Chancellor George Osborne, decided to let Vodafone off the hook. Proving once and for all, we're all in this together!

Vodafone has tried to defend of its tax affairs. However, its been revealed that Vodafone again paid no corporation tax in the UK last year. This is now the third year in a row. Vodafone did pay £275m in direct tax. However, once again Corporation tax accounted for almost none of the bill, which was made up of other forms of taxation such as business rates on Vodafone premises and VAT. Vodafone said Britain was “one of the least-profitable mobile markets anywhere in the world”.

UK Uncut said: It was one of the most shameless, blatant and costly examples of corporate-government cronyism in years. But at a time when the government are insisting upon massive cuts in public spending, the deal is particularly hard to swallow.

Vodafone did a similar sort of tax dodge in India. When Vodafone tried to avoid paying a £1.6bn tax bill. However, the Indian authorities, unlike the British are made of much sterner stuff. They have successfully pursued Vodafone for the money. Vodafone is still squirming in its capital gains tax dispute with the Indian government. This relates to Vodafone's 2007 acquisition of Hong Kong firm Hutchison Whampoa's stake in India's Hutchison Essar. My money is on the Indian government to get the tax paid. 


While our government is acting like a rabbit in Vodafone's headlights. Among those hoping the tax fiasco is fixed are other Telecom companies based in the UK. Which have become increasingly vocal in their attacks on the unfair tax advantages afforded to some multinationals.

However, it is the politicians themselves who are responsible for this state of affairs by creating a tax system which is hugely complicated and open to being exploited. The only solution to this is to create a simpler, fairer and more competitive tax system.

But it's your pound and it's in your pocket. The government are seemingly frightened of the wealthy multinationals, will do nothing. So can you find another supplier other than the tax avoiders to make your purchases.

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