Tesco has quietly returned to a multimillion-pound Channel Islands tax dodge four years after the authorities in Jersey banished the supermarket group's VAT-free CD and DVD website from the island, accusing Britain's largest retailer of operating a "sham" selling structure that brought the Channel Islands into disrepute.And how are they doing this?
Simples! They moved the operation to the island next door.
The Tesco Entertainment website is now offering online VAT-free sales of CDs and DVDs from Guernsey, the Guardian has learned. The tax avoidance involved may be unclear to many customers, however, as the site's small print simply states: "All prices are expressed inclusive of any VAT payable unless otherwise stated."And if it’s made clear, people will say ‘Oh, that’s terrible! If only I’d known! I’d happily pay more money to ensure that the government gets the VAT…’, I suppose?
Yeah. That’s what I thought too:
The move is likely to prove embarrassing for the British government which has sought to dismiss suggestions this VAT loophole trade is ballooning out of control.It seems everyone is expected to be ‘embarrassed’ by this. Who is embarrassed by doing something perfectly legal that saves you money?
Told of Tesco's low-key return to Channel Islands VAT avoidance, Liberal Democrat Treasury spokesman Vincent Cable said: "It seems to me absolutely extraordinary and seriously unwise for a leading British plc to be caught out dodging tax at a time when the country has a very serious fiscal crisis on its hands. I am sure if they are sufficiently aware of the importance of their reputation in this area that they will stop it immediately."Yes, I’m sure their customers will demand that they start charging higher prices when they don’t need to, Vince…
How I laugh at stories like this.
ReplyDeleteNotice how 'they' make out that paying tax is our duty to the state and those who manage to avoid it are smeared as dodgy dealers.
Dodgy dealer here:
ReplyDeleteNozama have done this for ages. Memory sticks and things, all shipped from C.I.
I suspect that an honest, upright citizen, say Tony Blair, just gets all his money and pays the tax exactly, in full, on the nail, like someone on PAYE would. Being a Labour supporter, he wouldn't use, say, an accountant, to maximise what he keeps behind? And definitely wouldn't operate, say, three companies, so he transfer stuff in and out.
It would be libellous of me to suggest that he might.
I don't see them picking on Moonpig. Or any of the loads of DVD/CD online retailers who do exactly the same thing.
ReplyDeleteAmazon have been doing this for years as well as have Play and various others that sell CDs and DVDs online. Hardly a surprise then that Tesco wouldn't want to be at a disadvantage.
ReplyDeleteFunny isn't it how the answer to this problem isn't to reduce the VAT charged on the mainland...
Anyway, isn't the gruniad's parent company registered offshore for tax reasons?
Looks like the LibDims need some lessons on tax law. On the basis of his appearance on the news last night, Clegg clearly doesn't know the difference between tax evasion and tax avoidance.
ReplyDeleteas a sales tax at 17.5% is iniquitous. it is far too high. 5% would be more than enough. It would be of copurse if it wasn't used for any EU funding. Hence the stupidly high VAT (which I know is much higher elsewhere)
ReplyDelete"Notice how 'they' make out that paying tax is our duty to the state and those who manage to avoid it are smeared as dodgy dealers."
ReplyDeleteIndeed. And as Clarissa points out, the Guardian iasn't above a little tax avoidance itself...
"I suspect that an honest, upright citizen, say Tony Blair, just gets all his money and pays the tax exactly, in full, on the nail, like someone on PAYE would."
Oh, I wouldn't doubt it for a minute. A pretty straight kind of guy, our Tone...
"I don't see them picking on Moonpig. Or any of the loads of DVD/CD online retailers who do exactly the same thing."
Indeed. But if they get their way with Tesco, they soon will.
"...as a sales tax at 17.5% is iniquitous."
It'll go higher. Mark my words, we'll see 20% before two years are out.