Tax Avoidance

Warrior House News | By Shannon Sanford
Posted: 08/03/2017 10:03GMT | Updated: 3 years ago

Tax Avoidance

Although tax avoidance is normally considered to be within the boundaries of the law, it is actually a method of skating around the justice system. It occurs when companies look for gaps in the legal system in order to avoid paying the taxes on all of the money that they earned. In many cases, companies falsely report that their profits were earned in countries that require very low tax payouts or even no taxes at all in order to retain more of their earnings.1

The UK is Cracking the Whip on Tax Dodgers:

Based on a July 2015 article reported in the New York Times, Treasury Chief Osborne of Britain has removed any special tax benefits on capital gains and earnings for those who live in the U.K. but don’t claim the country as their legal place of residence. According to Osborne, anyone who has lived in the country for over 15 years of the past 20 will pay the entire amount of taxes owed on all of their global income.2 

New Tax Base Proposal Scheduled For Release in 2016:
The EU Commission has proposed an Action Plan that recommends a Common Consolidated Corporate Tax Base (CCCTB) in order to effectively acquire all of the taxes that are owed to the country. The Commission is recommending the incorporation of more stringent rules for tax districts that are uncooperative by publishing a list of territories and countries that have been precluded by the affiliated EU states. In addition, the commission is gathering public advice to decide if companies should be required to reveal tax data by a Country-By-Country Reporting (CBCR) system. The new proposal could be released as soon as 2016.3

Walmart Tax Avoidance Allegations:

 Although there have been several companies in the past that have been guilty of overseas tax avoidance, Walmart has also recently been accused of hoarding assets that total over $76 billion dollars in various tax shelters worldwide. According to a study which was investigated by the United Food & Commercial Workers International Union and subsequently distributed by the Americans for Tax Fairness, around 90% of Walmart’s assets are maintained by affiliates in the Netherlands and Luxembourg. What is most interesting about the report is that Walmart does not have one single store in Luxembourg. Yet in spite of this, the retail giant reported $1.3 billion dollars in profits in 2010-2013 and paid less than 1% tax on the earnings. Since 2009, Walmart has developed a total of 20 brand new firms in Luxembourg based on findings in the report. Randy Hargrove, a spokesman for Walmart, disputes the report and says that it is designed to be misleading and inaccurate. Furthermore, he stated that Walmart has procedures in place to conform to the rules of the IRS, SEC, and to abide by tax laws in every country in which the retail store operates.4

There is one thing for sure regarding these allegations, and that is that the truth will eventually come to light. The Bible tells us so when it says “For there is nothing hidden that will not be disclosed, and nothing concealed that will not be known or brought out into the open.”5

The Bible also tells us that “Dishonest money dwindles away, but whoever gathers money little by little makes it grow.”6

So what it all really boils down to is being honest and doing the right thing the first time. As the old saying goes, “Crime never pays.” Therefore, the best thing that we all can do is to “lay up for ourselves treasures in heaven, where neither moth nor rust doth corrupt, and where thieves do not break through nor steal.”7 

*For more information regarding disclosure of overseas assets, please visit the irs.gov website.8 

______________________
1 http://europa.eu/rapid/press-release_MEMO-15-4609_en.htm
2 http://www.nytimes.com/aponline/2015/07/08/world/europe/ap-eu-britain-economy.html?_r=0
3 http://europa.eu/rapid/press-release_IP-15-5188_en.htm


4 http://www.bloomberg.com/news/articles/2015-06-17/Walmart-has-76-billion-in-overseas-tax-havens-report-says
5 The Holy Bible, NIV, Luke 8:17 

6 The Holy Bible, NIV, Proverbs 13:11
7 The Holy Bible, KJV, Matthew 6:20
8 http://www.irs.gov/uac/How-to-Make-an-Offshore-Voluntary-Disclosure

Shannon Sanford

Shannon Sanford

With over thirty years of writing experience, a MBA, and a BS in Psychology, Shannon has written on a variety of topics including: Business, Health, Science, History, Human Resources, Psychology, etc.
Shannon Sanford

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