The ‘Chancer-lor’ and the tax avoiders

The Google tax scandal reached new levels of absurdity last week when the tech giant’s president of European operations Matt Brittin told a parliamentary committee that he did not know how much he earned.

 
Labour MP Meg Hillier highlighted growing public anger of the Google tax settlement with the HMRC, amounting to only ÂŁ130m over the past ten years, which is now being scrutinised by parliament.

 
“You don’t know what you get paid, Mr Brittin?” Hillier demanded in a parliamentary hearing after asking Brittin repeatedly what he earned each year. “Perhaps you could give us a ballpark on what you get paid? Forget the share options, what’s your basic salary?”

 
“It’s a salary,” he responded. “I don’t have the figure but I’ll provide the figure privately, if it’s relevant to the committee to understand my salary.”

 
Chancellor George Osborne has time and again said that he would get tough on tax avoidance – it was a cornerstone of his budget in 2012, the same year he called the practice “morally repugnant”.

 
But as details as to how Google got away with paying so little tax remain plunged in mystery, revelations on Sunday (February 14) show that Osborne is himself involved in the same ‘morally repugnant’ practice he’s historically slammed.

 
His family’s wallpaper business, Osborne & Little Group Ltd, purportedly has not paid any UK corporation tax in the last seven years.

 
Dividend pay outs

 
A Sunday Times investigation of the company’s accounts revealed that, despite not paying corporation tax, the business shelled out £335,000 in dividend pay outs in 2015. Osborne, who owns 6,833 company shares, valued at more than £70,000, received a £1,230 dividend pay out, while his parents received £270,000.

 
The wallpaper company is headquartered in London and employs 195 people, who are overseen by a director earning more than ÂŁ600,000. Revenue for 2015 totalled ÂŁ34m, while the business reported profits of only ÂŁ722,000 which was split among directors.

 
Despite this, the company has managed to dodge paying any corporation tax since 2008, partly because it rolled over losses from previous years and deferred tax payments, with one deferred “tax charge” amounting to £173,000. The firm also reported paying £6,000 in tax overseas.

 
This isn’t the first time that Osborne & Little, which was co-founded by Osborne’s father Peter, has been in the spotlight over tax avoidance.

 
Only last year, Channel 4 revealed that the chancellor’s family firm, to which he is part heir, teamed up with a secretive offshore company in the British Virgin Islands to redevelop the company’s former London headquarters into housing.

 
Osborne & Little purportedly sold its site for just over 6m to the offshore company, called Nightingale Mews Inc., and then received planning permission for 45 flats and houses.

 
After Nightingale Mews redeveloped the site, it is estimated that the offshore firm avoided ÂŁ2m in tax on its profits.

 
Unite assistant general secretary Steve Turner lambasted the chancellor’s hypocrisy.

 
“Osborne claimed that Google paying only a fraction of the tax they should as a ‘major success’ – it was an example of mates rates for the very wealthiest. Now we have this example – an especially galling piece of news when only yesterday it was revealed that working people will continue to struggle on stagnant wages that aren’t going up anytime soon.”

 
“Tackling tax avoidance and evasion requires political will – Google and other mega-companies that hide their profits in tax havens around the world only do it because they can get away with it.”

 
“Osborne could very easily take a more hard-line stance by joining other countries such as France which demand more in tax from companies who’ve aimed to take advantage of global tax law loopholes,” he added.

 
“But how can we believe any future promises from the chancellor when he himself benefits from a system where the wealthiest can employ an army of accountants to sidestep contributing their fair share?”