Bank profits, windfall taxes and a better idea

[mailmannz]

MODS - What happened to my original thread and the reply that was in it????

 

Anyway, to recap I do not believe windfall taxes are the best way of "dealing" with profits made by the banks...after all, they are no different to any other "successful" company in England.

 

What banks should be forced to do, in my humble opinion, is to reopen all the branches they closed in the 90's, keep free banking and curb excessive penalty fee's.

 

Here is the reply to my original thread;

Mailman

 

Have a word with yourself. The banks already take most thier money abroad and pay very little tax here at all.

Can you please back this up with evidence? I have no doubt that profit does go over seas (after all, thats were a large number of shareholders live) but I doubt "all" the profit goes overseas.

 

I think you've been taking listening to too many bankers. Take John Varley GCE at Barclays who said on the day they anounced that thier £7.1 billion profits, that thier £2 billion tax payment was ''enough to build countless hospitals''.

This is 28% of their profit, which seems to be in line with what your own personal tax payment would be after removing NI and taking in to consideration the various bands.

 

Well it might do in the Caymen Islands because in fact Barclays paid less than half that due to thier legendary tax avoidance scams.

Hold the horses there pardner...there is nothing wrong with tax avoidance schemes...well that is unless you are Gordon Brown of course.

 

Tax avoidance is perfectly legal and I challenge you to show me a company (any company) that doesnt use tax avoidance schemes to reduce their overall tax payments.

 

I run my own company (IT contractor) and as such I have a duty of responsibility to my shareholders (the wife and myself ) to reduce my exposure to company tax through the use of legitimate tax avoidance schemes.

 

Customs & Excise have recently set up a unit specifically to look at Barclays tax avoidance methods. So in the unlikely event windfall taxes were imposed, it would only make up for the tax they should have paid in the first place

Again, you make it sound like its only banks that use tax avoidance schemes and that its only banks being targeted by HMRC.

 

The relality of the situation is that HMRC is not only tagetting banks BUT everyone who uses legitimate tax avoidance schemes. Banks are no worse than anyone else at using these schemes.

 

As I said, tax avoidance is PERFECTLY legal. There is nothing wrong with reducing your tax exposure, unless of course you are Gordon Brown that is

 

For the records, I have taken HSBC to the small claims court 4 times and won 4 times. I am not a lacky of the banks, I just do not see any point in taxing companies for being successful...especially since we all know that if windfall taxes were applied that money would disappear and never be seen again.

 

Mailman

[indebtstudent]

Sorry to jump in but I was just wondering what you made of the observation ( I heard it somewhere on tv) a lot of pension funds have stakes in banks and so, to some extent, them doing well is good for us.

[crfx250]

Mailman

 

1) I don't know where you got the 'all' from but it was'nt from my post. It is common knowledge banks invest much of thier profits abroad in creating tax avoidance schemes like Barclays building gas pipelines to generate tax allowances and routing thier insurance premium income offshore.

 

2) I did'nt say tax avoidance schemes used by the bank were ''illegal''. My point was that Varley boasted that his banks huge profits generated £2 billion in tax revenue. In fact he'll only pay less than half that in the uk.

And when jurnalists questioned a Barclays spokesman on this, his reply

was that this was an ''intellectual discussion for another day'' not exactly

backing up the words of his masters voice.

 

3) The 28 per cent would be in line with what you and me would pay but

of course Barclays contribution is more like 12.

 

4) I'm sure customs and excise target a wide range of markets using questionable tax schemes but the fact that they are launching a special

project bringing together the finest tax experts and lawyers to unravel

Barclays Byzantine scams that cost the exchequer hundreds of millions

each year, hardly suggests that thier tax avoidance schemes are as legitmate as those used by others.

 

5) And as for your brilliant scheme to, rather than impose windfall taxes on the banks

(which would only result in them paying the tax they should have paid

in the first place), ''force the banks to re-open all the branches they closed in the 90s'', was frankly, simply pathetic.

[Glenn UK]

Sorry to jump in but I was just wondering what you made of the observation ( I heard it somewhere on tv) a lot of pension funds have stakes in banks and so, to some extent, them doing well is good for us.

 

personally id rather have my money now and have the choice of whether to invest and how much in my pension rahter than use the banks unlawful and some would say obscene profits to save for my pension.

 

JMHO

 

Glenn

[mailmannz]

Mailman

 

1) I don't know where you got the 'all' from but it was'nt from my post. It is common knowledge banks invest much of thier profits abroad in creating tax avoidance schemes like Barclays building gas pipelines to generate tax allowances and routing thier insurance premium income offshore.

 

And what is so wrong with a successful company investing funds overseas?

 

You completely forget that the banks are the biggest employers in the UK and as such they also provide a heck of a lot of "benefits" for their staff. Granted, I doubt they do this because they love their staff but because there are probably tax breaks for doing such a thing?

 

I did'nt say tax avoidance schemes used by the bank were ''illegal''. My point was that Varley boasted that his banks huge profits generated £2 billion in tax revenue. In fact he'll only pay less than half that in the uk.

Right about now is the time you should post something that would back your assertion up because as it stands your comment is merely your own personal opinion.

 

The 28 per cent would be in line with what you and me would pay but of course Barclays contribution is more like 12.

Again, please provide something to back your number up.

 

BTW, my own personal company that I used for contracting paid no tax last year because I used, quite successfully, various tax avoidance schemes (most now closed by Gordo).

 

Again, there is nothing wrong with avoiding tax, unless you are from HMRC that is

 

I'm sure customs and excise target a wide range of markets using questionable tax schemes but the fact that they are launching a special project bringing together the finest tax experts and lawyers to unravel Barclays Byzantine scams that cost the exchequer hundreds of millions each year, hardly suggests that thier tax avoidance schemes are as legitmate as those used by others.

Again, this is nothing new. HMRC has launched a number of programs designed to reduce tax avoidance...heck me as an IT contractor have had to bore the brunt of those "purges".

 

And as for your brilliant scheme to, rather than impose windfall taxes on the banks (which would only result in them paying the tax they should have paid in the first place), ''force the banks to re-open all the branches they closed in the 90s'', was frankly, simply pathetic.

Windfall taxes would not neccesarilly result in banks paying more taxes, that is a massive assumption on your behalf.

 

You tell me, what is so "pathetic" about forcing banks to reopen branches in communities that they abandoned as soon as they could? Do you not agree that Mr and Mrs Average would receive more benefit from having a bank in their local community instead of having to travel to a bigger town to use a bank that is only open between 10am and 2pm Monday to Friday?

 

What you assume is that windfall taxes would actually be used to bolster the NHS etc...when quite frankly that is rather naive of you to assume the money WONT just disappear in to the big black hole that is the Governments accounts!

 

Maybe I’m being cynical but perhaps that is just balancing your naivety?

 

To me its quite simple, force banks to reopen branches, force them to keep free banking and force them to drop their "unlawful" penalty charges.

 

What you are advocating is that banks be punished simply because they are successful (when penalty fees form only a small part of a banks over all profit)...after all, thats the whole point of business...to make money.

 

You know Im all for Socialism and all that, as long as I dont have to pay for it!

 

Mailman

[crfx250]

Everything I've said about Barclays I read in several articals in the national press. But I guess you missed it as it would'nt have got much coverage in the Beano.

 

I'm not sure what government agency you think would have the authority to ''force banks to re-open thier branches'' (?) but which ever it was that agency would be funded by tax payers, which by your own admission, would'nt include yourself.

[mailmannz]

I'm not sure what government agency you think would have the authority to ''force banks to re-open thier branches'' (?) but which ever it was that agency would be funded by tax payers, which by your own admission, would'nt include yourself.

Why not the banking ombudsman office or the FSO? After all, arent they there to ensure banks operate within the law?

 

Whats with the personal attacks?

 

If you cannot discuss a point rationally then there is no point in you taking part.

 

Mailman

[crfx250]

Why not the banking ombudsman office or the FSO? After all, arent they there to ensure banks operate within the law?

 

Whats with the personal attacks?

 

If you cannot discuss a point rationally then there is no point in you taking part.

 

Mailman

 

Okey doke

[pedro8075]

If taken as a percentage of turnover, i don't believe that banks (pre tax) profits are a great deal higher that other companies.

The big 5 banks are right at the top of the corporate tax payers in this country.

Also, personal banking is not that lucrative for banks, much more money is made from business and corporate banking, in this country and abroad. Why should banks pay tax here for profit made overseas?

A lot of people in this country always seem to want to penalise success, not just in the financial services industry. Is it jealousy? Who knows?

Anyway, its not like they have these profits sitting in an account somewhere. Most of it is payed out to share holders as dividends, making money for many thousands of people and organisations. Pensions funds hold millions of shares in banks and do very well from them.

[mailmannz]

Unfortunately for the latent socialists out there, nothing short of handing over 100% of your profits will do.

 

BTW, Im not saying bank charges are good...quite the opposite! However companies should not be punished for being successful.

 

Mailman

[Guest NATTIE]

Ok, I need to bring a bit of realism into re opening branches closed in the 1990's, it would be impossible to do so because properties being sold, lease in the hands of other retailers, and changes in the branches networks as a whole, for example, HBOS(takeover) RBS Group(incl Natwest) Lloyds TSB(takeover). It would be a nice idea but unlikely to happen.

**** I think I should say that we should remember the rules of posting on the forum. Let's keep it clean****

[crfx250]

Ok, I need to bring a bit of realism into re opening branches closed in the 1990's, it would be impossible to do so because properties being sold, lease in the hands of other retailers, and changes in the branches networks as a whole, for example, HBOS(takeover) RBS Group(incl Natwest) Lloyds TSB(takeover). It would be a nice idea but unlikely to happen.

**** I think I should say that we should remember the rules of posting on the forum. Let's keep it clean****

 

 

Thanks for that Nattie. And you're dead right of course...as usual the embodiment of calm & reason