Big Four to be grilled by PAC

If you just can't get enough of the tax avoidance debate, tune into Parliament TV this Thursday when the heads of tax at the UK's Big Four firms will testify before the Public Accounts Committee (PAC). 

While it was previously thought they wouldn't appear before the PAC until at least March, MPs will grill the heads of tax for their part in helping large companies to avoid tax on 31 January.

 KPMG head of tax Jane McCormick, head of tax policy at Deloitte, Bill Dodwell, PwC head of tax Kevin Nicholson and Ernst & Young head of tax John Dickson will attend the hearing. 

In November, executives from Google, Starbucks and Amazon appeared before the MPs and struggled to defend their elaborate tax arrangements.

 

Continued...

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ShirleyM's picture

Hilarious    2 thanks

ShirleyM | | Permalink

 

While it was previously thought they wouldn't appear before the PAC until at least March, MPs will grill the heads of tax for their part in helping large companies to avoid tax on 31 January.

 KPMG head of tax Jane McCormick, head of tax policy at Deloitte, Bill Dodwell, PwC head of tax Kevin Nicholson and Ernst & Young head of tax John Dickson will attend the hearing. 

They will appear at this meeting to explain why they help large companies avoid tax, and they appear at other meetings to help draft GAAR.

Is this what we call 'putting the fox in charge of the chicken coop'?

PAC

david5541 | | Permalink

 it really isnt so long aago that what were the "big 6/big 8" were asked to demerge their consultancy divisions to address thes the issue of their audit independence. meanning accenture demerged from andersons and similar excercises were done amongst KPMG. coopers & lybrand Ernst and whinney, arthur young etc.....

now thse divisions have clearly been nurtured again within the big four framework and tax planning added on.

hence control of the audit market has become dominated by these firms with mid tier competition being sidelined sadly

"While it was previously thought they wouldn't appear before the PAC until at least March, MPs will grill the heads of tax for their part in helping large companies to avoid tax on 31 January.

 KPMG head of tax Jane McCormick, head of tax policy at Deloitte, Bill Dodwell, PwC head of tax Kevin Nicholson and Ernst & Young head of tax John Dickson will attend the hearing. 

They will appear at this meeting to explain why they help large companies avoid tax, and they appear at other meetings to help draft GAAR.

Is this what we call 'putting the fox in charge of the chicken coop'?"-YES GOOD TO SEE LIKE DAVID HARTNETT BEFORE THEM BEING GRILLED MARGERET HODGE CHAIRS THIS COMITTEE.

 

Amazing what a Google search throws up ...    2 thanks

JC | | Permalink

The Rt Hon Margaret Hodge MP - Chair of the Committee of Public Accounts

Stemcore -

Quote A

'.. Margaret Hodge’s shareholding in Stemcor

2,399,600 shares in Stemcor are currently held in Margaret Hodge’s name. This excludes shares held in trust or in her children’s names. The shareholding equates to 1.26% of the total share capital and the current value of the shareholding is £1.8m. Although Margaret Hodge is a shareholder, she is not involved in the running of the business in any way whatsoever ..'

Quote B

'.. Transfer pricing

‘Transfer pricing’ is not synonymous with ‘tax avoidance’ .... Stemcor, in accordance with the OECD guidelines, monitors the transfer pricing arrangements between its group companies to ensure that its pricing complies with the arm’s length standard .... Any suggestion that Stemcor has followed such practice is libellous. Stemcor does not abuse transfer pricing, as evidenced by the fact that tax has been paid at higher rates in overseas jurisdictions than would have been paid in the UK ..'

http://www.stemcor.com/Response%20to%20further%20allegations%20of%20tax%...

References

http://order-order.com/2012/11/21/margaret-hodges-multi-million-pound-st...

http://order-order.com/2012/11/20/letter-from-priti-patel-to-margaret-ho...

http://twileshare.com/ynt

http://blogs.channel4.com/michael-crick-on-politics/a-roasting-for-starb...

Rachael_Power's picture

Ahead of Thursday's grilling,

Rachael_Power | | Permalink

Ahead of Thursday's grilling, Hodge noted that UK's tax laws are "too heavily influenced" by large accountancy firms. 

Speaking to the BBC, she said tax reform working groups were too dominated by those with something to gain, with the news outlet referencing the patent box regime which comes into force this year.

Two KPMG managers were among those seconded to the Treasury to help come up with changes, according to the BBC, something Hodge said is "really dangerous". 

ShirleyM's picture

Thank you, Rachael, for that news    1 thanks

ShirleyM | | Permalink

So ... the penny has dropped, at last!

Now we wait to see if anything is done about it.

Who benefits?

The Black Knight | | Permalink

Who benefits from these public account misinformation circuses? What is their purpose?

The word of the moment to describe our politicians (either colour) should be nincompoops

 

Any tax laws been broken?    1 thanks

Ian Anderson | | Permalink

The representatives should dig in here and throw it back at the PAC. If no laws have been broken then stop all this chasing the accountants.

If the PAC and Parliament don't like this position then change the law to stop it.

Or are they all too frightened of big business?

The Big 4 representatives shoulkd be aggressive on this and not crawl around apologising.

 

 

 

 

ShirleyM's picture

Laws maybe not broken, but bent well out of shape

ShirleyM | | Permalink

Ian Anderson wrote:

The representatives should dig in here and throw it back at the PAC. If no laws have been broken then stop all this chasing the accountants.

If the PAC and Parliament don't like this position then change the law to stop it.

Or are they all too frightened of big business?

The Big 4 representatives should be aggressive on this and not crawl around apologising.

That is the crunch, isn't it.

Using loopholes, or using a relief in a way it was never intended, maybe isn't illegal, but it isn't wholly legal either as it relies upon a different interpretation of the law. Sadly, these schemes that push the boundaries cost the country a lot of money, both in lost revenue, and the costs of fighting them in the courts, changing the law, etc.

Who thinks up these schemes, and who promotes them? Do you think accountants are NOT involved??????

See this link for a good example of one of these schemes.

http://www.accountingweb.co.uk/article/court-rejects-medical-avoidance-scheme/536660

sluglet's picture

"KPMG head of tax Jane    2 thanks

sluglet | | Permalink

"KPMG head of tax Jane McCormick, head of tax policy at Deloitte, Bill Dodwell, PwC head of tax Kevin Nicholson and Ernst & Young head of tax John Dickson will attend the hearing."

Oh please please let one of them just stare at Margret Hodge and tell her:

"You made the rules. We followed them. If you don't like the rules, why haven't you altered them? Isn't that what you're here for?" 

 

Be good

The Black Knight | | Permalink

sluglet wrote:

"KPMG head of tax Jane McCormick, head of tax policy at Deloitte, Bill Dodwell, PwC head of tax Kevin Nicholson and Ernst & Young head of tax John Dickson will attend the hearing."

Oh please please let one of them just stare at Margret Hodge and tell her:

"You made the rules. We followed them. If you don't like the rules, why haven't you altered them? Isn't that what you're here for?" 

 

 

Be good, but I suspect the script has already been written and the actors have learned their lines?

You would raise this point in defence wouldn't you? Unless you were having your tummy tickled?

looks like

colintimpson | | Permalink

I agree with all that is written above. But i can't help but notice that in the picture above RH Hodge looks a lot like Anne Diamond. So will she be saying "you are the weakest link, goodbye" to the Big4??

 

Does she honestly believe that any senior Tax adviser will tell her how to close the loopholes and damage all of their clients?? get real folks.

 

People start a business to make money and not to pay tax. So of course they welcome the advise that is given to reduce their tax bill, wouldn't you??

 

influence from accountants

Taxdev | | Permalink

of course the flip side is that the law is so complicated only tax accountants can understand it so of course they have influence

Companies pay tax, they pay

caron | | Permalink

Companies pay tax, they pay the required amount due by law,, if the laws are wrong then they need to be changed.

Perhaps Mrs Hodge needs to be educated, I hope that the parties being 'summoned' for an audience will offer there collective help. All she needs to do is ask.

 

PAC grilling

sf&co | | Permalink

Whilst the big 4 may be accused of immorality, I assume some/all of the select commitee members might be accused of hypocrisy with their dubious expense claims, flipping claims for houses etc?

What party was in Govt from

caron | | Permalink

What party was in Govt from 1997, so who wrote the current regulations? Blair, Brown, Balls...?

Makes me feel slightly sick...I hope that they completely intimidate MH, she needs putting down a peg or two!