Monday, 21 February 2011

Barclays, in the firing line.

It had to happen sooner or later: UK Uncut, the provisional wing of Her Majesty's Revenue & Customs, have decided that Barclays, a business which moved heaven and earth in order to avoid a government bail out, selling businesses and going cap-in-hand to arab potentates instead, is now well capitalised and safe, having mostly paid off its creditors, who made a significant profit for their risk.

Well done all round - the people taking the risk profit for bailing out a business, which thaks to good management (including from the justifiably well remunerated Bob Diamond) continues to pay tax - income taxes, banking levy, NI, non-reclaimable VAT etc... and didn't cost the UK tax-payer a penny. If maximising tax revenues, as UK uncut claim to want to do, what is their problem? But corporation tax is, like 28%, innit. Tax avoidance! Waaaaaaa!

Now I don't need to tell you, this is wrong because, like all banks, Barclays lost enormous amounts of money during the crisis, it is allowed to carry those losses forward, and offset them against future profits, which it is now making. It only paid 9% corporation tax in 2009. I'm not going to crunch the numbers, others have done so, but should this really be surprising anyone with even the faintest idea of how the Tax system in any grown-up country actually works? Barclays is now making profits, largely thanks to the (boo!) investment bank, including the assets of (double boo!) Lehman Bros. which it bought in the fire-sale, and will pay corporation taxes when it's used up the brought forward losses, just like every other business in the UK.

What do UK Uncut actually want? Are they profoundly stupid, or deeply dishonest?


Dominic Allkins said...

I'd say they are both stupid and dishonest.

They seem to have forgotten also that this happened with GB was running the whole show after 11 years of being Chancellor, so perhaps they should be directing their ire at Millipede the Younger as well.

banned said...

BBC Radio 2 broadcast the basic figures "Barclays made X billions in profit and paid out (not very much) in tax" leaving listeners to come to the wrong conclusion themselves.

Anonymous said...

Maybe they just don't like bankers very much , not hard to understand when the bonus season is in full swing again.
Ordinary working stiffs are being shafted to provide these leeches with their not hard to achieve gains.

Simon Jester said...

o rly, DKM?

BTW, WTF does "DKM" stand for?

Anonymous said...

Maybe that companies should pay income taxes at the same rate as people. After all if I sell a car at a loss, I can't claim that as an expense against my income for the year. Just a thought...

Henry Crun said...

Dishonest - they are preying on the ignorance of the average Labour voter. Most intelligent people are well aware that Barclays did not get bailed out by the taxpayer and therefore owe us nothing. Secondly, most intelligent people understand that Barclays could not operate outside of tax legislation and if there was even the slightest hint of impropriety on the past of Barclays, HMRC would be all over them.

@Anon 4.58 if your business was buying and selling used cars, you could offset the loss against your tax bill. You are just the sort of person on whose ignorance UKUncut are relying to make their case.

Anonymous said...

Carrying forward losses is very easy to explain. It just means that you pay the right amount of tax on average over a number of years. I am normally supportive of the BBC, but think it is appalling that the BBC didn't explain this (or interview someone who could).

Anonymous said...

UK Uncut members simply want what all Socialists want:

1. The right to bully other people with impunity
2. Other people's money

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