The super-rich are inventing investments to avoid paying taxes.
Nearly 40 percent of global foreign direct (FDI) investment involves “no real business activities” according to a study by the International Monetary Fund and University of Copenhagen.
This “phantom” capital, worth $1.5 trillion, passes through “empty corporate shells” and is used “often to minimise multinationals’ global tax bill”.
The study identified a number of countries in which less than half of FDI is “genuine”.
These included Malta, Ireland, Switzerland and a number of British crown dependencies.
In Ireland nearly two thirds was “phantom”.
Economist Brad Setser said phantom companies or phantom investments “are optimised for minimising firms’ global tax”.
“Apple does not produce its iPhones in Ireland, nor does Apple design them or develop the majority of its operating system in Ireland,” he said.
Yet “one of the most valuable US foreign direct investments now is Apple’s ownership stake in Apple Ireland”.
And the problem is growing. The study said more and more overall FDI is made up of phantom capital.
In 2010 phantom FDI made up 31 percent of the total.
By 2017 the figure was 38 percent.
- In Britain, the figure rose from 3 percent in 2009 to 18 percent in 2017.
Britain’s “unfair and outdated tax system” must be transformed, says a left wing think tank.
The Institute for Public Policy Research said that taxing capital gains at the same rate as income could raise an extra £90 billion a year.
It said the difference in tax rates had led to more inequality.
“It is fundamentally wrong that people who get their income from betting on the stock market or playing the property market pay less tax than those who work,” it said.
“The current tax system works for the rich.”
- Tory officials tried to block Jacob Rees-Mogg from standing as a Tory MP in 2010 as he was too posh.
It was part of a failed drive to make the Tories look less like an out of touch, privileged elite.
A new biography of Rees-Mogg by Lord Ashcroft says Rees-Mogg was out of favour as he was a “white, privately educated, middle class male”.
- Paedophile billionaire Jeffrey Epstein allegedly attended princess Beatrice’s 18th birthday party at Windsor palace in 2006.
One source told the Sun newspaper, “It goes to show how Epstein worked his way into the very heart of the British establishment—rubbing shoulders with royalty at a palace.”
Mordaunt offered as ‘prize’ to Tory donor
Tory MP Penny Mordaunt has shed some light on the disgusting culture in her party.
Mordaunt described being offered as a “prize” to a donor at a Tory conference fundraiser when she was just 23 years old.
“One man said to another that if he gave the party a particular donation he could take Penny home and do what he liked with me,” she recalled.
“It hurt that an organisation that I respect so much could have so little care for me.”
- An MP who sent thousands of sexual text messages to two young women has been cleared of any wrongdoing by the parliamentary watchdog.
Andrew Griffiths was forced to resign as business minister last July.
He had sent 2,000 sexual texts to two women in 21 days in which he referred to himself as “Daddy.”
The watchdog found no evidence that he sent the messages while engaged in parliamentary activities.
Good riddance to racist John Mann
John Mann has left the Labour Party to be an “antisemitism tsar” for the Tories.
Mann has a history of attacking those who support Palestinians.
In 2013 Mann was a witness in an action against the UCU union over its support for the Boycott, Divestment and Sanctions campaign.
Mann declared this campaign antisemitic. A tribunal threw out the case.
The judge said that Mann had given evidence without having witnessed “any Congress or other UCU meeting”.
He can’t be relied on to fight racism.
A pamphlet on “anti-social behaviour” written by Mann lists problems people may face, including “graffiti,” and “travellers”.
One Romany Gypsy constituent of Mann’s said, “It’s outrageous from a man that likes to give the impression that he’s against race hate and prejudice.”
Torture is ok for this Tory
Tory defence secretary Ben Wallace apparently thinks that torture is ok.
Wallace told a newspaper in 2003 that it was “absolutely the norm” for a prisoner to be “manhandled fairly roughly” by soldiers during interrogation.
“You might pretend to pour petrol over them, when it’s actually water,” said Wallace”
Director of human rights group Reprieve Maya Foa said pretending to pour petrol on someone “amounts to a mock execution”.
Best non-news of the week
In February 1988 Labour leader Jeremy Corbyn attended the wedding of Paul Hill, the Daily Mail newspaper reported this week.
Hill was one of the Guildford Four, who were wrongly convicted of the Guildford pub bombings of 1974.
The Mail revealed that Labour’s shadow chancellor John McDonnell also attended the wedding of an innocent man.
It reported that Corbyn had said at the time, “Paul Hill is a constituent of mine. I believe he is innocent and support the fight for his release.”
A year later, the convictions of the Guildford Four were overturned.
- Many children went to school last week, some for the first time. One was a princess called Charlotte.
School protest over uniform
A protest by hundreds of students and parents shut down a school in Sussex on Friday of last week.
School bosses had brought in what they called a gender neutral uniform policy to apply to all students.
They said students not wearing the new uniform on the first day back at school would be sent home.
One placard at the protest read, “£100 for
1 uniform for 9 months is not sustainable.”
Another said, “Fast fashion is the second biggest contributor to climate change.”
‘A bull overpowered him and charged into a police officer’
The Daily Mail reports Boris Johnson’s ongoing woes
‘Can’t talk about Brexit’
Johnson’s sister Rachel Johnson on her family
‘It has come to almost Isis levels in its intensity’
Rachel Johnson on the Brexit rows in the family
‘Please leave my town’
What one man told Boris Johnson when he visited Leeds last week
‘I need you to be like Fonzie, because Fonzie is cool’
What Boris Johnson’s adviser Dominic Cummings told staff, urging them to keep calm over proroguing parliament
‘Great big girl’s blouse’
What sexist Boris Johnson called Labour leader Jeremy Corbyn last week
What Johnson called former Tory prime minister David Cameron in August
What Johnson called Cameron and his brother Jo Johnson in 2013