Gibraltar, Britain, Spain and tax dodging

This video says about itself:

28 September 2016

Gibraltar has been placed on a list of countries which may be considered for detailed tax screening. It follows a new EU listing process aimed at identifying and addressing third country jurisdictions that fail to comply with good tax governance standards.

From daily The Morning Star in Britain:

Gibraltar: the EU’s tax haven

Tuesday 4th April 2017

Tory willy-waving misses the point when it comes to Gibraltar‘s dubious place in the European Union

GIBRALTAR is making headlines again in Britain, following a couple of years of silence.

The last time such a furore was kicked up over the overseas territory was when Labour’s then leader Ed Miliband warned it — along with other British possessions — that if he won the election in 2015 it would have six months to compile a public register of offshore companies to assist a clampdown on tax havens, or face “international action.”

That didn’t go down any better with Chief Minister Fabian Picardo than this week’s mention of the Rock by European Council president Donald Tusk has.

Tusk’s statement that no EU-British agreement would apply to Gibraltar unless Spain gives it the green light has prompted willy-waving Tories to threaten a Spanish equivalent of the Falklands war, while Picardo accused the EU chief of behaving like a “cuckolded husband taking it out on the children.

“Gibraltar belongs to the Gibraltarians and we want to stay British,” he declared.

It’s a bit rich for the foreign secretary who helped launch the entirely unprovoked invasion of Iraq to accuse anyone else of “19th-century jingoism,” but Jack Straw is right that Gibraltar’s British status is seen as an affront to Spanish sovereignty by most Spaniards, and right that threatening military action is “frankly absurd.”

British nationalists assert that the right of Gibraltar’s residents to stay British is a matter of democratic principle, and there can be no doubt that the vast majority do want to remain subject to Britain.

The most that can be said for this argument is that it beats basing our claim entirely on the 1713 Treaty of Utrecht, when the enclave was ceded to Britain “in perpetuity” in return for London abandoning its campaign to replace a French king of Spain with an Austrian one.

In some respects politics has moved on since those days. Gibraltar’s population may wish to be British, but overseas territories whose wealth depends on companies using them to avoid tax due elsewhere do not have an inalienable right to keep doing so.

Picardo has always rejected the charge that Gibraltar is a tax haven, but look at the facts: this tiny strip of land has more registered companies than households, including 8,464 offshore companies — not bad for a population of just over 30,000.

As Britain’s former ambassador to Uzbekistan Craig Murray points out, over a 10th of the workforce is employed in the online gaming industry, based there purely to avoid taxes, and the territory imposes “no inheritance tax, no VAT, no capital gains tax and low income and corporation tax.”

Tax advisers Darwin Tax describe Gibraltar as “the tax haven of the European Union” and assure clients: “A Gibraltar company which is owned and controlled by non-Gibraltar residents is not subject to Gibraltar taxation.

“The non-resident status of the company is supported by the Gibraltar Companies Ordinance. If such company does not carry on any trade or business in Gibraltar, all taxes are avoided.”

As the only “offshore centre” which is actually part of the EU, Gibraltar is uniquely attractive to capitalists who need their companies to be registered in the EU but also want to avoid their obligations to any of its member states. The losers are the citizens of Spain, Britain and other countries whose treasuries miss out on taxing the profits of companies that operate in their territories, employ citizens they educated, use their infrastructure and sell in their markets.

Whatever differences socialists may still have on the EU, it should not be hard to agree that Gibraltar’s tax status is an anti-democratic disgrace.

It should be brought to an end, along with the anti-social privileges granted to corporations in the rest of Britain’s network of offshore tax havens.

Also from the Morning Star, 4 April 2017:

Len McCluskey, general secretary of the Unite union, which has thousands of members in Gibraltar, said the government had not grasped the implications for local workers, who rely on being able to cross the border with Spain every day.

He condemned “sabre-rattling and warmongering” by some Tory rightwingers.

Conservative Prime Minister Theresa May has refused to condemn the comments by Michael Howard that her government would be prepared to go to war with Spain over Gibraltar: here.

UK accidentally invaded Spain in 2002, reveals former First Sea Lord: here.

11 thoughts on “Gibraltar, Britain, Spain and tax dodging

  1. Pingback: Gibraltar, Britain, Spain and tax dodging! | World4Justice : NOW! Lobby Forum.

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  3. Wednesday 5th April 2017

    posted by Morning Star in Features

    Howard’s interview was a weapons test of the political mood, says NATHAN AKEHURST

    FORMER TORY leader Michael Howard’s Sky News interview in which he appeared to raise the prospect of Britain going to war with Spain was completely unhinged.

    This is not an insult to Howard, or a response to the point he was making;? it is an entirely analytical statement.

    One can haggle over precise words at length but the proposition of war with Spain was his intended and received meaning.

    Howard chose his words carefully in a way to appear as unhinged as a British politician can while retaining something approaching credibility. I suspect he did so with approval from the highest levels of government.

    I suspect this because there has been no real attempt to slap down Howard from on high. A Downing Street spokesperson issued a long quote,?but nowhere did it deny the possibility of war with Spain or say something that avoids a forced denial while still politely insinuating that Howard has been at George Osborne’s gak stash again.

    A second quote did admit “it isn’t going to happen” but remained supportive of Howard’s comments.

    This is not because we are actually about to invade the Costa del Sol. Britons have, understandably, been doing that since the ability to escape this mildewed bog we live on became affordable.

    This is not about Spain. The Spanish are not scared. They are intimately acquainted with political bullshit, and are laughing their heads off. But we are not.

    In the immediate hours following, journalists hungry for a Sunday afternoon story went wild. Howard was interviewed again. By evening, everyone from opposition politicians to military sources were weighing in. A Telegraph article evaluated our naval capability ahead of any potential clash with Spain.

    This is how the insurgent right has operated for generations, culminating in Donald Trump’s Twitter account. Wait for a quiet moment, say something utterly outrageous and then wait for the talking heads to start seriously debating and discussing it.

    Even if they disagree with you, you’ve won. You have achieved coverage of your argument and made it part of accepted political debate.

    This can be done to the point where a mainstream journalist can ask the shadow home secretary whether she thinks “political correctness” was to blame for the recent attack in Westminster.

    The left can make this tactic work. While Jeremy Corbyn’s suggestion for the pay of the highest and lowest paid workers to be pegged to one another was partially botched, it succeeded in starting a frenetic national conversation about runaway pay.

    But currently, it’s used against us. To the Tories’ voting base, leftish or liberal outrage at the possibility of carpet-bombing Madrid over a lump of rock we nicked off the Spanish way back when can simply be framed as contempt for the people of Gibraltar.

    This is something the left genuinely needs to avoid ?—? as Unite goes to the polls, Gibraltarian news is carrying a decent story on the election, and union density among workers there appears to be higher than in Britain.

    The Howard gambit should not be confused with Lynton Crosby’s “dead cats.” The dead cat is done as a last ditch ruse when you’ve screwed something up and need a quick fix.

    This inane call for a new Anglo-Spanish war is a strategy for normalising extreme views.

    In this case, it may precede the ramping up of military bombast.

    In 2013, the government was beaten back over an attempt to bomb one side in the Syrian civil war. They risked being beaten again when they decided to bomb a different side in 2015.

    In 2016, the Chilcot report provided Britain with two million words of painful, forensic detail on the disaster in Iraq.

    Popular consent for casual militarism is low both in Britain and elsewhere; the global right are seeking to reverse this.

    Trump wants a $54 billion defence spending increase amid claims he’s threatened to invade Mexico and North Korea. Japan’s Shinzo Abe wants an anti-war clause in his country’s constitution removed. China and Russia remain alert.

    The British deployment in Estonia, which borders Russia, has commenced.

    What better way to gain support for the polishing of rifles than a claim that even somewhere as harmless-seeming as Spain is ready to stab us in the back?

    The Howard interview was a weapons test of a political rather than military kind.

    But playing with these feelings for PR purposes can be lethal, as we learned from the spike in hate crime after “swarms of migrants” rhetoric during the EU referendum.

    I mentioned above that the left could learn from a shoot-from-the-hip approach. But we also need to be able to neutralise it.

    From “Legs-it” (where Theresa May intervened to attack the Daily Mail’s critics) to Howard’s attempt to invade Spain on the Sophy Ridge show, the news at the moment is filled with attempts by right-wing cranks to bait and disorient opponents while radically shifting discourse.

    We’re only a week into the Brexit negotiations. This nonsense will keep coming, thick and fast.

    It will need heading off before someone actually decides to nuke Seville.


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