Money | Anorak - Part 40

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Money in the news and how you are going to pay and pay and pay

Why should Apple pay US taxes?

APPLE’S results are out and they’ve had another giganticly stonking quarter. But there’s something I do wonder about. There’s a campaign in the US to make companies pay US corporation tax: at the moment, if a US company makes money offshore and doesn’t bring it into the US then it doesn’t pay tax on those profits.

We’ve had a similar argument here over Vodafone. That was all about whether a Luxembourg part of Vodafone should pay UK tax on the profits it made selling phones in Germany to Germans.

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Posted: 25th, April 2012 | In: Money | Comment (1)

Idiot Newspaper Headline of the Day

THE worst headline of the day. From the New York Times:

With Venezuelan Food Shortages, Some Blame Price Controls


It’s one of the most basic concepts in economics. Cut the price of something to below the market clearing price and supply of it will fall and demand for it will rise.

Thus there will be shortages.

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Posted: 24th, April 2012 | In: Money | Comment (1)

Even the CBI doesn’t understand corporate taxation

THE CBI does not understand corporate taxation:

The business group dismissed accusations that large companies enjoy a cosy relationship with HM Revenue & Customs, and said public anger over tax avoidance and evasion stems from “misunderstanding” of the complexities of the tax system.

John Cridland, the CBI’s director general, said: “Business is paying its fair share of tax – we are much misunderstood. Today is the beginning of the fightback to say we’re paying the right amount of tax and the way to get the economy moving is lower rates of tax which will lead to more tax being paid.”

The point being that business cannot be paying the “right” amount of tax because business never pays tax, not a red penny, ever.

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Posted: 20th, April 2012 | In: Money | Comment

Fracking idiots come to the fore

THERE are indeed reasons not to like fracking for shale gas. Yes, those earthquakes but they’ll only be happening in Lancashire so who gives a crap? They’re also small, about the same as we used to get from coal mining and we dealt with those well enough for a century or more.

It’s also true that having lots of cheap gas around will keep us all warm and toasty for the next century or two. There are those who disapprove of that, might stop us from regressing to the peasant lifestyle which will make us all so much better human beings.

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Posted: 18th, April 2012 | In: Money | Comments (2)

Yet more Argie stupidity over the Falklands – stealing Repsol

THE Argentinian Government has just decided to nationalise steal a Spanish oil company.

The Argentine government has been tightening the noose on Repsol over recent months, withdrawing operating licences and accusing the company of failure to invest adequately in its Argentine operations.

Yes, yes, that really works, doesn’t it? Encourage more foreign investment in the country by confiscating foreign investment in the country.

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Posted: 17th, April 2012 | In: Money | Comments (2)

Fracking turns every household tap into a flame thrower (video)

FRACKING is back. The Government is expected to give the thumbs up to fracking –  extracting natural gas by hydraulic fracturing. There will be earthquakes as Blackpool turns into a giant trampoline. And that is not all. Fracking might infect  groundwater and cause your taps to turn into flame throwers. Careful with that toothbrush!

Posted: 17th, April 2012 | In: Money | Comment

Facebook, Google, Apple, Amazon, eBay: are all tax dodging scumbags

FACEBOOK, Google, Apple, Amazon and eBay are all tax dodging scumbags. At least this is what the Daily Mail would have you believe, that the big five internet firms, Facebook, Google, Amazon, eBay and Apple are all tax dodging bastards:

Figures from the companies’ American filings suggest that the five made revenue of £12.2billion in Britain in 2010 from British consumers and advertisers.

On the basis of their global profit margins for the year, that would mean profits for the five from sales to British customers would have amounted to almost £2.5billion. Corporation tax at 28 per cent would have seen them pay £685million.Instead, subsidiaries established by the five in Britain paid just over £19million in 2010, or 0.8 per cent.

The problem with this is that it’s all entirely bollocks: because we’re in the European Union.

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Posted: 16th, April 2012 | In: Money | Comment (1)

The Labour Party protest in photos – with added pike

AT the Labour Party conference at NUI Galway, protesters angered by austerity measures stormed Garda barricades. Pepper spray was deployed at no little cost. Someone took a pike along. Who? And where do you get a pike from? Who in times of austerity has money to lash out on a pike? Given the state of the Irish building industry, surely a cement bag and some bricks is the preferred method of enacting judicial revenge..?

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Posted: 15th, April 2012 | In: Money | Comment

Brussels spouts more nonsense on bankers’ pay

THE latest nonsense coming out of Brussels is this, on bankers’ pay:

Austrian centre-right MEP Othmar Karas has called for an end to massive bankers’ bonuses, which in some cases amount to 10 times the basic salary.

“We are looking at a set limit,” Karas told the parliament’s economic affairs committee in Brussels on Thursday (12 April). He explained that under his model, bonuses should not surpass a ratio of one-to-one on fixed salaries.

Now maybe it’s a good idea that bankers’ bonuses should be restricted. Maybe it’s not: I happen to think not but that’s just my view.

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Posted: 13th, April 2012 | In: Money | Comment

Turf the poor out of central London

FOR some reason I don’t understand there’s a number of people arguing that we shouldn’t be trying to get the poor people to move out of central London.

That is indeed what is happening though, the poor are moving out to the suburbs:

Outer London has seen rising levels of poverty while the number of poorer areas in central London is reducing, according to a new analysis of official deprivation data.

Although the poorest places in the capital are still in the eastern centre of the city, there are fears that poverty is being pushed out into the suburbs amid evidence of a significant increase in deprived areas in the outer boroughs between 2004 and 2010.

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Posted: 12th, April 2012 | In: Money | Comments (5)

So how will Greece leave the Eurozone? Answer: painfully (photos)

HOW will Greece leave the Eurozone? Painfully it seems.

There’s a general agreement among realist economists (ie, not those drunk on some nonsensical dreams of European unity) that the euro as it was set up was a decidedly bad idea. That even if it had been better set up Greece certainly shouldn’t have been part of it and that it would be better for Greece and everyone else if Greece were to be out of the euro.

All of this is simple enough. The problem is how do we get from here to there? As this column points out in what for economists is sneering and vitriolic language, erm, actually, we probably can’t.

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Posted: 11th, April 2012 | In: Money | Comment

Polly Toynbee’s tax transparency by not being tax transparent – fail

POLLY Toynbee has called for everyone’s tax returns to be public information. To help things along she’s decided to release her own income figures:

Personal statement, to get in early: I have always advocated total tax transparency, and like George Monbiot, I am open about my own earnings: I was even asked about it by a parliamentary select committee so it’s on the record. Last year my Guardian pay was around £115,000. I have never had any kind of company, and I have always paid PAYE as an employee. I would welcome all journalists agreeing to transparency, especially those writing about the earnings of others.

No, sorry, I’m afraid that is something of a fail.

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Posted: 10th, April 2012 | In: Money | Comment

Lunatic economist of the day

IT’S always a little difficult going over and reading the dark side, the spouting of the ecoloons. For they’re so far from any connection with reality that it’s confusing trying to work out exactly what it is that they’ve got wrong.

For example, our friend here, seems to think that capitalism requires growth: it doesn’t. He also seems to think it requires markets: it doesn’t. He even name checks Adam Smith but then use the wrong book (Theory of Moral Sentiments is about philosophy, Wealth of Nations is about economics).

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Posted: 9th, April 2012 | In: Money | Comment

God finds Mirlande Wilson’s winning Lottery ticket in Burger King urinal

WHEN Baltimore McDonald’s syrup server Mirlande Wilson claimed she had won $105m on the Mega Millions lottery, the New York Post paid her a visit. Says Wilson:

“I have no idea where it is. I’m not sure I have it.”

Think, Mirlande. Think!

“I’m still looking for it. I haven’t even looked in my uniform pants yet. I’m still looking everywhere to find it, in my purse, everywhere.”

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Posted: 6th, April 2012 | In: Money | Comment

Campus studs offer free booty to female students

AS we all know a rattling good shag helps clear the mind, reduce stress and generally makes everything better. Thus three lads at a German university have selflessly offered themselves up to the female students as providers of such rattlingly good shags.

For, as they say, studying for exams can be stressful, it can cut into the time available to maintain (or even seek new) relationships so why not just send the lads an email and they’ll come around (fnar) to root out (fnar, fnar) that stress with a booty call.

Oskar and his partners then reply: “Many students are too stressed out during exams to go out at night. This leads their sex lives to languish.” But armed with the knowledge that regular physical exercise brings health benefits and helps with studying, the young men behind Bib:Love are more than happy to provide support. Female students who spend their evenings drained and fatigued in the library and are in the mood for a little closeness and intimacy are encouraged to send an email. Then one of the three men will meet with them. If the circumstances are right, the meeting ends in sex.

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Posted: 6th, April 2012 | In: Money | Comment

Amazon doesn’t pay any tax schocker!

THE usual suspects have got all outraged at the fact that Amazon doesn’t seem to pay very much tax in the UK:, Britain’s biggest online retailer, generated sales of more than £3.3bn in the country last year but paid no corporation tax on any of the profits from that income – and is under investigation by the UK tax authorities.

Regulatory filings by parent company with the US securities and exchange commission (SEC) show the tax inquiry into the UK operation, which sells nearly one in four books sold in Britain, focuses on a period when ownership of the British business was transferred to a Luxembourg company.

Well, yes, the clue is in tat last part there, it’sd not a UK company so of course it doesn’t pay corporation tax in the UK. It’s a Luxembourg company and so it pays tax in Luxembourg. This is all part of the great EU project. You pays your corporation tax where your company is, where the head office is, and then you can sell anywahere in the EU. To change that you’d have to change the basic design of the EU.

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Posted: 5th, April 2012 | In: Money | Comment

Government spending our money to lobby Government: the swine

YOU may or may not be lucky enough to see posters around the place arguing that all cigarettes should be sold in plain packages. This, it is said, will reduce smoking and thus thousands of faerie folk will frolic in our woodlands. That it will do nothing of the sort is only a trivial point.

The background is that at present the government is carrying out a “consultation exercise”. This is where they pretend to listen to people and then decide whether to do whatever it is. Now, if people wish to influence this consultation exercise they’ve every right to do so. This is a democracy with free speech after all.v This is actually what we’re supposed to do, tell the fuckers who rule us how we want to be ruled.

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Posted: 4th, April 2012 | In: Money | Comment (1)

Japan to ban bananas

JAPAN is to ban bananas! This fuss over the radiation from the Japanese nuclear disaster is really getting just a touch out of hand. For they’ve just passed a law which seems to mean that bananas will be banned.

Under the new rules, the limit for general foodstuffs such as fruit, vegetables, rice, seafood and meat is 100 becquerels of radiation per kilogram, down from 500 prior to April 1. The limit for milk, baby food and infant formula is 50 becquerels per kilogram. For drinking water and tea leaves, it is 10 becquerels per kilogram.

Bananas are about 130 Bq a kilo you see. Meaning of course that we’re all now dead from the mashed nana we had for tea when toddlers.

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Posted: 2nd, April 2012 | In: Money | Comment

Apple’s Foxconn interns paid better than Lib Dem interns

SO there was this great big campaign, with petitions and plays and online sign ups and the usual ignorant outrage displayed on Twitter and Facebook about how appalling the working conditions and pay were at Foxconn. You know, the giant seris of factories in China that make everything for Apple and HP and Microsoft and all.

We’ve now got the results from an in depth investigation into those working conditions and pay.

The general finding is that poor people work long hours for not much money. Well, yes, that’s true, that’s what being poor means, working long hours for not much money. Shrug, that’s what poor people in poor countires do, that’s why we describe them as poor and that’s why we’d like them to carry on having an industrial revolution so they can become rich like us.

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Posted: 30th, March 2012 | In: Key Posts, Money, Politicians, Technology | Comment

What’s really meant by Dynamic Scoring

GIVEN that The Guardian has already given us the screaming hysterics article about this dynamic scoring of tax changes perhaps it’s about time someone explained what is really going on?

OK, starting right at the beginning, the most important thing to know about economics is that incentives matter. Changes in tax rates are changes in incentives so they matter.

When we do static analysis of tax changes we just assume that no one changes their behaviour in response to these changes in incentives. YUoiu know, like everyone would keep smoking the same mount if ciggies went up by another £5 a pack tomorrow? And there definitely wouldn’t be any smuggling in from the Continent, no Siree!

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Posted: 29th, March 2012 | In: Money | Comments (3)

The Truth About the Pasty Tax: Yup, it’s the EU

MUCH fun and games as Georgie Osborne has to defend his pasty tax. As one wag has pointed out whether a pasty which has cooled to 21 oC needs to pay the tax will depend upon whther the ambient temperature is 22 o or 19 o.

However, there is a real reason that he’s changed these rules. Fully described here but in essence it’s the EU again.

As we all may or may not know hot takeaway food pays VAT, cold doesn’t. Until just recently no one was very worried about those things that may or may not be hot: as long as we were getting the VAT on the fish and chips and not on the salads we were fine.

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Posted: 28th, March 2012 | In: Money | Comment

The disappearing gender pay gWE’VEap

WE’VE been screamed at for years that there was this gender pay gap thing and told how appalling it was. Thing is, the gap seems to be disappearing:

Although overall the gender pay gap remains, with women earning 9.1 per cent less than men, in part-time work the trend is reversed.

Data from the Office for National Statistics show that since 1998, median hourly earnings excluding overtime pay have been higher for female employees.

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Posted: 27th, March 2012 | In: Money | Comment

Why The NHS Is So Cheap

I KNOW, we don’t think of it as cheap when we look at the £100 billion a year and rising in taxes that we have to pay to fund it. But by international standards the NHS really is quite cheap: 9 or 10% of GDP (GDP is all the money we have each year) as opposed to 11 or 12% in France and 18 % in the US.

Some will argue, some do argue, that this is all down to the fact that we’ve got this planned by lovely politicians and thus there are no greedy hucksters making profits from it. Could even be true but that’s not the only possible reason. One that we know very well is true is that those politicians doing the planning simply deny certain medical treatments to certain people:

Thousands of elderly people are dying unnecessarily early because ‘despicable’ age discrimination in the NHS is denying them treatment for cancer, a charity has warned.

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Posted: 26th, March 2012 | In: Money | Comments (3)

George Osborne doesn’t pay tippy toppy rate tax

GEORGE Osborne doesn’t pay the top rate of tax. Sounds about right.

His salary puts him close to it, yes. And then on top he’s got rental income plus possible dividends from shares in the family company (which, amusingly, I was offered a job in years ago).

The rental income will be pretty much offset by the mortgage interest relief he gets. No, you don’t get this on buying your own house any more, not if you live in it. But it’s obviously a business if you’re renting it out so you do indeed get to count the interest paid as a cost of doing business. There’s also the maintenance allowance. If I remember my own tax returns that’s 2% of capital value or something like that.

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Posted: 23rd, March 2012 | In: Money | Comments (2)

Smoking does not cost the NHS money: nor does obesity

SMOKING does not cost the NHS money: nor does obesity. Nor even does booze. So we can tell the health wowsers to bugger off the next time they use that argument upon us.

Read:  The Killer Shisha tobacco scaremongering blows up in smoke.

Now it is true that all three impose costs upon the people that do it. Shorter lives for a start. But it’s also true that something that people do voluntarily must also provide benefits to them: and it’s up to each individual to decide which risks they want to take for which benefit.

And it’s that thing about shorter lives which is why the booze, tabs and rolls of sweaty fat don’t increase costs to the NHS. It’s the healthy people who live long enough to spend 5 years drooling into their bibs as they fade away from Alzheimers:

“Until age 56  annual health expenditure was highest for obese people. At older ages, smokers incurred higher costs. Because of differences in life expectancy, however, lifetime health expenditure was highest among healthy-living people and lowest for smokers. Obese individuals held an intermediate position. Alternative values of epidemiologic parameters and cost definitions did not alter these conclusions.”

The lifetime costs were in Euros:

Healthy: 281,000

Obese: 250,000

Smokers: 220,000

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Posted: 22nd, March 2012 | In: Money | Comment