My GRAPIST anti tax avoidance bill is a work of perfection, and to show how it would work in practice, I thought I’d show how it would crack down on Starbucks evil tax avoidance.
Firstly, it is important to note that Starbucks royalty payments have already been adjusted by transfer pricing rules to achieve an arms length price.
Well, my GRAPIST would see through that because whilst that might be reasonable and fair, someone else, me for example, could come to the reasonable assumption that this wasn’t the true economic position and that actually Starbucks should be paying millions of pounds to the UK subsidiary for helping them promote the brand in this country.
I mean, I travel a lot and the first one I ever saw was in Norwich. So every coffee I buy from Starbucks ought to be paying royalties to the Norwich branch.
So a reasonable person would reasonably conclude that Starbucks should be paying tax at a percentage of 15% of turnover in the UK. Because that’s how some people think, reasonably so.
Because this is reasonable, or the reasonable person thinks so at least, when HMRC challenge the business they can refer to that reasonable person’s reasonable conclusion and adjust Starbucks’ tax liability to that.
Why? Because that’s what my GRAPIST says.
You see, the bill basically says that whatever the taxpayer thought the legislation said when they read it, even if it is correct, we can ignore. The bill attacks anything that seems like tax avoidance.
And when you look at things that are included in my tax gap as avoidance, you realise this means absolutely anything that reduces tax yields, even if it was intended by Parliament, is avoidance.
As the author of the bill I must be the perfect example of a reasonable person, so whatever I say seems like tax avoidance is the basis of a fair rule of law.
Of course that’s just my opinion but under my GRAPIST opinions become more valid than the law.
In this sense, my bill is already binding law because it seems like good law and if the MPs do not enact it they will seem to be acting with tax avoidance motives. Therefore we look beyond their actions and see that the GRAPIST is already law as we speak.
That is the power of good legislation, it strikes down all other legislation. It even makes politicians redundant.
I don’t know why we bother having them sometimes.