Tag Archives: tax

Hypocrite Hodge

One of the recurrent themes on this site is the exaggerated terminology and projected moral outrage (not to mention ‘grandstanding’) of politicians progressing their influence in the Westminster bubble, and possibly their earning capability when thrown out by the electorate.

High on Grumpy’s vomit list is Dame Margaret Hodge, who wins the award, if there was one, for high minded, bombastic self-righteousness. A constant topic for Ms Hodge has been organisations and individuals not paying a “fair share of tax”.

Of course no-one (including our good Dame) has any generally accepted or definitive definition for what a “fair share” is. It seems to be a deliberately opaque (and hence indefensible) measure based on firstly (a) paying the maximum amount of tax the regulations might allow, whilst ignoring government granted allowances, plus (b) paying an additional amount until there is no left wing objector (Owen Jones?) to the figure actually paid.

Grumpy admits to being  a tax “avoider”, in that he uses ISA’s, pension funds and a few other things to avoid giving any more of  his meagre income than he is obliged to the government. Is he paying his fair share ?  He doesn’t  know.

What he does know is that he pays the amount mandated by tax legislation and no more. This is the  accepted principle as set out in 1936, when Lord Tomlin  ruled that: Every man is entitled, if he can, to order his affairs so that the tax attracted under the appropriate act is less than it otherwise would be. If he succeeds in ordering them so as to secure this result, then, however unappreciative the commissioners of Inland Revenue or his fellow taxpayers may be of his ingenuity, he cannot be compelled to pay an increased tax.”

This is exactly what Amazon, Google etc. do, which annoys Dame Margaret. They follow the law, as set out by politicians like Hodge. If there are ‘loopholes’, it is because of sloppy drafting of those laws.  The answer is simple – politicians made the laws, these companies follow them, and if Dame Hodge doesn’t like this then she should get her own sort to change them, not ask the companies to somehow donate an undefined  “fair share” or be pilloried. Politicians response to legislation they drew up having unforeseen aspects is to ‘name and shame’, rather than admit their drafting errors and fix them.

It would be entirely scurrilous of Grumpy to note that the highly moral Dame Margaret was a significant shareholder in a family business, the billion dollar company Stemcor , a private and secretive company based in a tax haven, which is now owned – wait for it – by a private equity fund. Billion dollar ? Tax haven ? Private equity? surely not the godly socialist  Margaret ???

It is illustrative of Dame Margaret’s singularly repulsive hypocrisy to quote from Stemcor’s own web site

“The Stemcor Group may optimise its tax position to maximise shareholder value … ” *

Pass the sick bag ….

  • https://www.stemcor.com/terms-conditions/tax-strategy/