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> As far as I can tell, they shift profits overseas by shifting extra, semi-fictional 'costs' to the UK subsidiary - for example, if the UK subsidiary of Starbu
by muyuu 12y ago
> As far as I can tell, they shift profits overseas by shifting extra, semi-fictional 'costs' to the UK subsidiary - for example, if the UK subsidiary of Starbucks makes $100m profit, but has to pay the Canary Isles subsidiary $100m in licensing costs, suddenly the UK subsidiary owes no tax.
Canary Isles?? The Canary Islands are Spanish jurisdiction and hardly a tax haven. I guess you mean the Caymans or maybe the Channel Islands?
- spruce 12y agoYou should brush up on the status of the Channel Islands, Canary Islands and other various EU country administered islands used as havens. (Here's a starter from a simple google search : http://www.lowtax.net/information/spain/spain-canary-islands-special-zone.html http://www.lowtax.net/information/spain/spain-canary-islands...) It has become so complex that no-one can really keep on top of it other than the obvious fact that big companies seem to be able to avoid tax and suck whopping pay packets for their elites (again without any inconveniences such as tax).
- muyuu 12y agoI should know, I was raised there. The Canary Islands have some special treatment with respect to mainland Spain in things like VAT and petrol tax, which are still in line with many European countries (and you don't go that far to buy retail petrol, it defeats the purpose). By the way the data on that site is outdated, the general IGIC (VAT) is up to 7% since 2012 and the maximum is 20%. As for the other exemptions, they are hardly "tax haven" label worthy. Nothing compared to the Channel Islands, Luxemburg, etc and more in line with countries like the Netherlands. I have yet to know of anyone not from Spain who'd choose the Canary Islands to dodge taxes, and I know plenty of people with offshore accounts (work in the other Canary - Canary Wharf, London).