In March The Economist magazine rang alarm bells (again) about a rise in concentrated market power: a problem where the biggest firms get ever bigger and more like monopolies, making it easy to extract wealth from the rest of us (as opposed to creating wealth.) This, in turn fosters steeper inequality and poverty and reduces economic growth. As they put it:
“High profits across a whole economy can be a sign of sickness. They can signal the existence of firms more adept at siphoning wealth off than creating it afresh, such as those that exploit monopolies. If companies capture more profits than they can spend, it can lead to a shortfall of demand.”
Someone has just posted an article about the need for multinational companies to protect their reputations from investigation of their tax affairs. The gist of the article is that MNCs need to step up their public relations effort to communicate their tax affairs more effectively. So we can all look forward to more corporate spin as they try to explain away their dodgy deals in Luxembourg.
But one line in particular caught this blogger’s eye and perfectly exemplifies why so many tax accountants, tax lawyers, corporate spin doctors, uncle Tom Cobley and all, are so wrong about tax avoidance.