Crickhowell: Still battling the taxman


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The small business owner who appeared on the BBC show ‘The town that took on the taxman’ has told AccountingWEB that accountants of multinationals “should look at themselves in the mirror and ask, ‘Am I adding value to society or am I simply acquiescing to these big corporations?’”

BBC2 viewers saw Steve Lewis and the other small business owners from the Welsh town of Crickhowell replicating tax strategies used by multinational corporations as part of the campaign’s fair tax protest.

Seeing the tax techniques adopted by large corporations caused Lewis to question the philosophical role of the big corporation accountant, adding: “It’s not the function of the accountants to try and get the tax liability down to zero by looking at the 11,250 lines of tax code.”

The Crickhowell café owner has now set his sights on succeeding Lin Homer as the next HMRC chief executive as he attempts to crack down on multinational tax abuse. Lewis has started a petition  to garner support for his campaign to become “the people’s tax man”.

In under a week since the programme aired Lewis has gathered over 125,000 signatures. His plan is clear: “My focus is absolutely now on naming and shaming the biggest abusers and the accountancy tricks they are using to get the consumer to decide what is fair.”

One of Lewis’ suggestions is along similar lines to the catering trade’s five star hygiene rating. He said: “What if you had a tax one that showed five stars and this guy pays reasonable stars. This guy is a tax abuser, zero stars. Let the customer know how much you’ve paid, and then they’ll decide whether they want to come into your shop or not.”   

Jolyon Maugham, the tax QC who advised the small business owners, said that the reaction to the programme has been “enormously positive”. He said: “Most people out there won’t have any idea what putting these arrangements in place looks like. What this story does is enable viewers to see that very often these arrangements don’t actually involve any profound change to the nature of the business being done.”

However, not everyone has been supportive of the fair tax campaign. Lewis has come against resistance from Lord Crickhowell.  Lewis told AccountingWEB how the Tory peer came into Lewis’ restaurant and told him: “Whatever I did, I shouldn’t go after Osborne because he is a wonderful chap, who’s doing all he could about the tax regime.”

“Over simplified”

Paula Tallon, Gabelle’s managing partner, criticised the BBC2 programme’s “over simplified” representation of tax. “They look at a company turnover, and say ‘their tax is x% of their turnover’. This is misleading because tax is on profit,” she explained.

Tallon also said the tax avoidance strategy presented in the programme was “quite misleading as to what organisations are doing.

“The rules in the UK allow the large corporates to put these structures in place”, she said. “A lot of the differences are that the individuals would take the money out as loans and dividends – so they were bringing the money back into the UK.

“My concern is that to someone who knows very little about tax, it made it look like there were all these things people could do and they weren’t talking advantage of them, and they ought to. But what they proposed could fall foul with anti-avoidance”.

Lewis also initially shared this concern. “I believe in tax, I believe in paying my way.” he said. He pushed the BBC producers to change the name of the programme, which was originally called ‘The Town that went offshore’. “I am getting really uncomfortable with the notion that we are stating as a fact that the town can go offshore,”

Lewis recounted his conversation with the BBC. “I knew from the offset, you can’t take a town offshore. It is nonsense.”

But the main message Tallon got from the programme was to “support your local businesses”.

 Commenting on the programme, an HMRC spokesperson said: "HMRC enforces the tax rules fairly across the board, irrespective of the size or structure of the business. The government is clear that big business must pay its fair share of tax, so new legislation has been introduced to prevent multinationals from diverting their UK profits from the UK tax system, and additional funding has been invested in HMRC to tackle abuse by multinationals.

“The UK has also played a leading role in a recent review by the OECD of how the international framework for taxing multinationals needs to be improved.

"We fairly and dispassionately enforce the law and as Jim Harra makes clear in the programme, if we receive a plan we will look at it in that light".


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25th Jan 2016 11:33

I watched this programme
To say it was total garbage as far as its analysis of UK tax is concerned is an insult to garbage. It is pretty shocking if Jolyon Maugham really thinks such a nonsense scheme works.

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25th Jan 2016 12:47

Client perception

I also watched said program as did one of my clients who called me the next day and asked why I hadn't recommended this type of scheme to him. My response was did he miss the bit where Maugham said HMRC would be all over it and it would be at least 3/4 years before it even got to a tribunal and that his fees were £5K to £40K per day. Also the guys doing it were even on the program exercising central management and control in the UK making the whole exercise a complete waste of time.

I did suggest that if he wants to go and live in the Isle of Man, it may be possible (subject to all the anti avoidance rules etc, etc) but the weather is as rubbish as it is here.

Cayman Islands looks a better bet!



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By carlh
25th Jan 2016 13:17


lol if cayman then point him to bbc documentary below


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25th Jan 2016 13:34

fair tax

Output VAT is required to be declared on the VAT return, relieved by input VAT, if any.

Why can HMRC not combine the two taxes of VAT and Corporation tax on one form with both Output VAT and corporation tax ( at conveniently same rate of 20%) to be shown as liability and relieved by input VAT and relevant expenses (inputs + other items like payroll, finance charges, etc). You pay all your taxes in one go and if there is any final adjustment to make towards the end of the accounting year, then that would be done in the last return or on the subsequent return.

This way, all taxpayers would pay fair tax.

Question will be for those who are outside the scope for VAT.

Well, the answer to that would be - lower the VAT registration to Nil.




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25th Jan 2016 14:14

See previous thread

There was an extensive thread on why such a scheme is not as simple as you propose.

As for this man's campaign to be HMRC CEO, he appears to have as little grasp of what the job entails as he did of the tax planning depicted in the program.

Let's take the "tell your customers how much tax you paid" idea for a start. A business that makes low profits because its prices are too low to cover its costs properly gets lambasted for it. What about businesses with genuine capital allowance claims? What about spouse's wages where the spouse actually puts significant time into the business? Would the only way to get a five star rating be to actually have tax taken directly on income? If not, just who decides what is and isn't acceptable that doesn't actually breach the law?

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25th Jan 2016 15:16

Did I miss something ?

The way I saw it, the Crickhowellites would be quite happy to lose any case with HMRC provided the decision applied to the multinationals as well. I'm sure HMRC would argue that it's all a tax dodging exercise and should be disregarded, but then the same should apply to the big boys.

I liked the comment "our waitress pays more tax than Facebook!"



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25th Jan 2016 15:46

Something missed

Eddystone wrote:
The way I saw it, the Crickhowellites would be quite happy to lose any case with HMRC provided the decision applied to the multinationals as well.
I would be inclined to say that the something missed is that the over-simplified setup shown in the program doesn't really mirror the planning of the multinationals.

Just to take one example, saying that it is difficult to challenge charges for use of intellectual property is not quite the same as saying that you can charge whatever you like for something you've made up solely for that purpose. Brands like Starbucks and Google do have an undeniable value, and a not insignificant one. Arguing the same applies to the "Fair Tax Town" brand seems a bit of a stretch.

There is a reason people like Jolyon Maugham charge a fortune for defending such schemes.

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25th Jan 2016 15:41


These Google etc. multinationals are not, as far as I am aware, UK tax resident, so that is yet more garbage. The BBC's Cayman programme last week was total garbage too incidentally.

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25th Jan 2016 15:52

Programme is the way we British spell it....

...if in Rome....Please use the British way of spelling  (The GoodEnglish Professor)

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25th Jan 2016 16:19

Unless it's a computer program ;-)

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25th Jan 2016 19:11

Yes. That's right. That was established in the early 1980s. Sadly we have been infestated by too much Americanisation of our English language.

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