Taxable Morality

Starbucks are to review their tax practices according to reports and media in the UK.  So we are now relying on big corporates to take the first step and say ‘we haven’t paid enough tax, we want to pay more’.

How many out there would follow their lead?

How many out there will look at their own tax affairs, and say, “you know what, morally I can do more’.

The tax system provides opportunity to maximise your profits and minimise your tax burden.  There exist international laws and treaties.  The OECD published their Guidelines, updated as recently as July 2010.  The question is, are these organisations compliant?  If yes, then in reality they are within their rights to do what they can to become tax efficient and fulfil their obligation to their shareholders.

With reference to Amazon, what are their functions in the UK?  Where are the key decisions made? Which entity takes the risks?  Who owns the assets?

How many British organisations control profits abroad, providing a comparable return, in similar fashion to what foreign organisation are doing in the UK?

What are the implications, internationally?  Are we now going to go through a period of double taxation disputes; if so how much will that cost HMRC and ultimately the common taxpayer?

We all must remember that if the UK claims that profits have been earned in their jurisdiction, then that will reduce the profit in another jurisdiction and as a result reducing that authority’s tax income.  Will they simply accept the decision?

These are murky waters, that the public cannot dictate the path.  This is a journey for the policy makers, not just of one nation but many.

Morality - Governments and Multinationals

“We are not accusing you of being illegal; we are accusing you of being immoral.”

These were the words of Ms. Hodge from the Public Accounts Commission during the questioning of Google, Amazon, Starbucks.

After hearing this quote, a scattering of thoughts ran through a mind in the very chaotic fashion written below.

As the news spread via the press with all its negative connotations, there began a public outcry against the evil multi-nationals that come to the shores and take the profits away with them without paying their just dues. 

Boycotts and anti-corporate slogans are promoted, requests to turn to the forgotten local businessman or woman who is the victim to the devil from across the seas.

Corporations create employment, employment creates wealth, wealth creates spending power and spending makes the economy go round.  In a time when we are all asked not to save but help turn the cogs of the economy - jobs help create that motion, can the smaller business do that at the same speed as the as the corporate giant?

In it’s most simplistic view – the corporation is playing within the rules – no illegal activity has been proven or even brought into question.  There is a clear acknowledgement that the rules allow the activity that has been undertaken. 

Is the individual who decides to put his or her savings into an ISA in the UK not ‘avoiding tax’?   

While the UK government continues to reduce the corporate tax rate, is that not immoral to the countries that cannot do so?  Is the government reducing the rate to help struggling businesses alone?  Will foreign organisations not look at the UK rate and find it more attractive than that of the US for example?  Will the Patent Box not entice developers and thinkers from other jurisdictions to consider what their financial position would be in the UK compared to the nation that they reside in?  What of the morality of a government and its responsibility to global economics?  In the current climate do we do away with global responsibility?

Treaties and agreements can be reached in many instances.  But if the government signs up to Transfer Pricing Guidelines as put forward by the OECD in 1995 then 2010 does it still have the power to change the rules as quickly as it would like?  Leading governments will not want to disrupt the balance, even in this time of what in some cases is desperation. 

What if the Spanish authorities decide to lower its corporate tax rates to such a level that foreign organisations find it too difficult to resist – Spain speculates and then in time accumulates.  Is it immoral to plan for the future for that nation for its people?  Or is the answer that if a government does act competitively then it’s ok; if a nation makes a profit its ok.

In government and business where is the line of morality when both work on making profit?

Is it not up to the governments to collaborate and change the playing field? 

The answer, for me, is that the authorities need to change the rules and until such an action is undertaken, they should not accuse the organisations of ‘immorality’.  In order to change the rules there needs to be global consensus, as all the jurisdictions are shareholders of the world economy.

The question is how likely is this.

Right choice, right approach, right job, 5 tips to success

For those who have made plans for the end of the world in 2012, I guess this is irrelevant.  However for everyone else who is expecting the world to carry on, and who is seeking employment or is looking for a role change, below are five key points that should be considered.

Looking for a job is a job

Why is it so stressful? Let  alone all the monetary pressures that can exist during unemployment, or dissatisfaction and potential morale issues in an existing role, looking for a job is a job in itself.  Casually looking for a job limits your chances.  Trying to find the perfect role is not the same as looking for a girl/boyfriend “you’ll find someone when you are not looking”; time needs to be dedicated to this task.  Focus is required to establish what you want out of your new role.  Honesty is required in acknowledging any gaps you may have in your own knowledge and skillset.  Have confidence and remember that you have something to bring to the table.  This is a chance to change your working life for the better, enjoy the fact that you have this opportunity to make that change and if you do, the process is not as painful as you think.  Use the help out there; recruitment specialists, jobsites, social and professional networks; if you want it, and need it, you’ve got to chase it.

If you don’t believe in yourself, why should anyone else?

This is a point that in conversation everyone I have spoken to says ‘yes that’s so true’.  Then why do so many people get so nervous in interviews, why do so many job applications lack that confidence?  Always remember what you are selling – ‘you’.  You are a package of knowledge, experience, personality and individuality.  If you cannot talk about yourself and the good things that you have achieved, who will?  Who can?  When looking for a new role, be prepared to talk about yourself, enjoy talking about yourself, remember your flaws – but not as flaws but how they are positive; a lack of in-depth knowledge can provide the platform for a desire to learn and develop further.  You may be a university graduate with all the technical ability in the world; but waiting for that first opportunity to gain the experience, talk of how you influenced peers and maybe lecturers on projects, leadership that you demonstrated to pull a group assignment through, societies or groups that you have contributed to; how and why.

Fail to prepare, prepare to fail

This is a point where I am so often surprised.  The interviewing company / individuals always expect a candidate to come fully prepared; they’ll almost be tired of hearing the same information from the same internet webpages again and again – but they want to hear it.  I once had an interview and advised the interviewer that I had prepared and researched everything that every other candidate would have researched.  I was of course more than happy to share my findings about his organisation with him, which I duly did.  But when I spoke with him on my third day into the role, I was surprised to hear that a number of candidates overlooked this point.  This is 2012, we have the internet, and it has never been so easy to research companies and individuals.  I even look up the interviewer on networking sites, to gauge knowledge of his/her background and interests.  Look to make that connection – the right conversation topic can often help the process.

You’re not the only one getting interviewed

Do you have a choice to decline a role that you have been interviewed for? Yes.  Is it important that the organisation that you are looking to join also satisfy your needs? Yes.  Taking this on board, you have the opportunity to ask the interviewer questions; there’s nothing wrong with it.  You want to make sure the organisation and role is right for you.  Ultimately this means that the move is right for the organisation.  Ask the questions that are important to you; of which many will be answered throughout the interviewing process.  I often attend interviews with a list of questions tailored to the role I am looking into. 

Why? Why? Why?

Nobody likes to hear why they are not chosen.  This comes from when you are children, and being the last guy out of a line up to be on one team or the other doesn’t feel good.  But the question that was probably never asked and in some cases not answered properly is ‘why?’  Knowing ‘why’ enables you to address it, turn it into a positive journey of self-development.  That’s why if one is unsuccessful in an interview two things must be remembered: (1) It’s not the end of the world, it just wasn’t meant to be.  If you have done all the things that you were supposed to leading up to the interview then sometimes you have to accept that you were probably beaten by a better candidate or that actual role wasn’t right for you. (2) Ask for feedback; what did one lack against the competition.  In the past I have asked the interviewer how they feel I can address the flaw; so the next time I have an interview I am either demonstrating that I have addressed the issue or at least in the process.

Take all this into account and your job search process will seem a little easier.  The current climate means not every door you knock on will welcome you in and subsequently is adding pressure everywhere.  The last thing we need to do is increase it by not covering the points that we should. 

The world is your oyster, as long as it doesn’t end.