The Co-operative Tax Scam

[alanjjohnstone]

Couldn't find an existing co-op thread to add this to (i find the forum search facility not so good) 

For all those dewy-eyed reformists on the Left who insist that co-operatives are the way forward and a step towards socialism, i'd like a comment from them about this corporation tax dodge story

http://www.theguardian.com/business/2015/oct/04/how-astrazeneca-avoids-paying-uk-corporation-tax

Quote:

In April 2013 AstraZeneca set up its unusual Dutch lending operation – an arrangement described as “highly artificial tax avoidance” by independent tax experts.

The loan structure, which is within the law, centred around a type of Dutch co-operative, an unusual corporate entity first allowed in the mid-19th century to assist dairy farmers.

AstraZeneca’s co-operative is incorporated at the group’s Dutch offices, eight miles east of The Hague. Accounts for AstraZeneca Finance Coöperatief WA do not show signs of significant business activity: there are no staff on the payroll and it has modest operating costs.

Nevertheless the co-operative was packed with loans of $2.7bn from head office in the UK, and charged interest of more than $140m a year.

Interest flows exploited differences between the way tax codes in the UK and the Netherlands apply to Dutch co-operatives. The result was that the two tax offices treated the interest as occurring on their own patch, both awarding huge tax breaks for the same payment. 

In tax avoidance jargon, claiming a tax deduction twice on the same payment is called “double dipping”.

Capitalism in adaptable enough to incorporate co-ops into its accounting tax avoidance/evasion and it can easily absorb a whole system of co-operatives in wage slavery and exploitation. 

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