This is from Richard Murphy’s post which flounders in trying to reconcile Fair Tax Mark’s consideration of obtaining EIS relief for investors:
But let me go back to Nick James’s point: whilst the law is as it is you sometimes have to do things that definitely comply with it whether you like it or not, because that’s what necessary.
Now, I agree with that statement. And I’d say that this follows from that statement, given a bit of knowledge of what is necessary under tax law:
It would be wholly inconsistent to endorse the above statement if you were to have a go at a company that applied, say, an arm’s length price using the exact same terms it applied to independent third parties.
I think it’s fair to say that it is indeed hypocritical if you were to stand behind that statement and then imply that necessary tax compliance actions following a commercial decision to, say, centralise European operations (such as coffee bean purchasing and roasting), were in any way tax avoidance or, even, “immoral”.
And those two things aren’t even a favourable comparison for Richard’s defence of the EIS issue. Transfer pricing is a mandatory requirement whereas EIS is an optional relief. I mean, you have to impute an arm’s length price, there’s no choice about that. HMRC would tear you apart if you didn’t.
But you certainly do have a choice whether to apply for the Enterprise Investment Scheme. Maybe it is purely a moral choice, as opposed to a legal one, eh?
Nobody that I’ve seen is really accusing the Fair Tax Mark of tax avoidance. That’s a straw man argument from Richard and he must surely realise that.
People are just pointing out that if Richard consistently applied his own arguments and principles, he would not conclude, as he readily has, that many of his previous targets were avoiding tax by complying with the law in the manner it was intended.
It is hypocrisy, undoubtedly.