Revealed: How Multinational Companies Avoid The Taxman

Revealed: How Multinational Companies Avoid The Taxman
· Elaborate structures to move profits offshore
· International investigation into banana firms
by Felicity Lawrence and Ian Griffiths

Global banana companies supplying the UK are using tax havens to avoid paying tax on their profits here and in developing countries, the Guardian has found.1106 07

The investigation reveals that large corporations are creating elaborate structures to move profits through subsidiaries to offshore centres such as the Cayman Islands, Bermuda and the British Virgin Islands, to avoid handing money over to tax collectors in the countries where their goods are produced, and in those where they are consumed. Governments at both ends of the chain are increasingly being deprived of the ability to raise tax for development or services.

Dole, Chiquita, and Fresh Del Monte, the three companies that supply several UK supermarkets and between them control more than two thirds of the worldwide banana trade, generated over $50bn (£24bn) of sales and $1.4bn of global profits in the last five years. Yet they paid just $200m, or just over 14% of profits, in taxes between them over that period, our analysis of their financial accounts reveals.

In some years the banana companies have paid an effective tax rate as low as 8%, even though the standard rate in the US where they have their headquarters and file their full accounts is 35%.

The banana companies are not alone. Nearly a third of the UK’s 700 largest businesses paid no corporation tax in the year 2005-06. A further third paid less than £10m each, according to figures from the National Audit Office.

The use of offshore havens by rich individuals to avoid paying tax was high on the political agenda this autumn, with Gordon Brown matching the Conservatives’ pledge to tax “non doms”. But increasingly, the far bigger challenge for government is how to keep up with the strategies being developed by large corporations to cut their tax bills.

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http://www.commondreams.org/archive/2007/11/06/5053/

Restaurants pay lower than minimum wage by law.

I still can't understand how the middle class hasn't taken to the streets just over the tax issue??

Why is ANYBODY paying taxes if they make less than $ 30K a year.

If the government needs money so badly they should set up an IRS in the Cayman Islands.

and if you don't, guy who has money can take it from you.

Great societal model we have, isn't it?