Tim Worstall: UK will never introduce a “Google Tax”

Mr. Googletax

We’re a few days late with this, but it’s still fun.

There’s a commentator out there, a former press officer for the racially challenged and anti-European UK Independence Party, who likes to attack TJN from time to time. His speciality is the sneering, ad hominem attack: he has a record of having called women things like “bitch” and “little bitch” and using the c-word and others to describe trade unionists and people he generally doesn’t like. The commentator, Tim Worstall, is discussed in this longish article, which is well worth reading if you’ve come across him and want to get a flavour.

We normally ignore people like this but Forbes magazine, in their great wisdom, have decided to give him a platform to peddle his views — even though the violence of his opinions about tax is not matched by a commensurate level of knowledge or understanding of the issues involved.

A recent Forbes column of his, entitled The Guardian’s Absurd Suggestion For Osborne’s Google Tax, begins:

“The Guardian has one of the more absurd suggestions I’ve yet seen over what George Osborne might announce later today as his “Google Tax”. OK, sure, we don’t expect the Guardianistas to be all that economically literate nor are their arts graduates all that good with numbers. But the idea that the Chancellor of the Exchequer is about to announce a change in the tax law that would be flat out illegal is really going beyond the bounds of the latitude we normally give them.
. . .
A suggestion so absurd that whoever actually wrote this script (sadly, the site doesn’t seem to say) must be living on a different continent, perhaps in an alternate reality altogether.”

You can see what we mean about the sneering.

Just few hours after that column was published, and hey presto! George Osborne announced his, ahem, “Google Tax.” The very same impossible tax.

Worstall has a long record of getting it spectacularly wrong. Back in 2012 he wrote an article entitled The Tax Justice Campaign Falls Flat On Its Face. You’d Need A Heart Of Stone Not To Laugh. It’s got the same sneering tone as most of his posts, and it’s just as deliciously wrong as the Google tax story:

“I’m sorry but I just couldn’t help but burst out laughing when I saw this story this morning. So is one of the more po-faced and puritan campaigns of recent times forced to face their own errors, their complete disregard for facts in any of their evidence.”

His argument seems to be that the UK’s tax authorities did not realise that some UK residents are so-called “non-domiciled” taxpayers, who don’t pay tax on their overseas income. Which is a rather odd claim to make, given that the agreement itself contains a whole section (Article 4) discussing them.

Now here’s what actually happened.

The UK government in 2012 signed a corrupt tax deal with Switzerland, and predicted that they would reap £4-7 billion pounds from it. We did an exhaustive analysis of the deal, and predicted they would not raise more than £1 billion because of the mass of loopholes in the deal, such as the deliberate facilitation of escape via discretionary trusts and other mechanisms.

And how much did the UK government raise from the deal?

Drumroll. . . about £1 billion. We’re tempted to say ‘you’d need a heart of stone not to laugh’ – though when you think of the implications of all this, it isn’t really that funny.

Anyway: if you haven’t, go and read that article now, “Tim Worstall, British attack dog.”