Tax Scams and the Brexit Mess

Finance & Fury Podcast

Welcome to Finance and Fury, the Furious Friday edition.

Today we are discussing what is happening with Brexit?

At the time of the release of this episode, we will be approaching the 11th hour of the 2nd deadline to negotiate a deal for the UK to leave the EU. Why would it be grim and awful as they put it?

Today:

• Want to give a timeline of events
• Look at the massive tax scheme that is going on
• Check out the series on the EU – What happens if the EU collapses? and Will the EU fall apart?

Start at the beginning:

• The referendum to leave the EU 23rd June 2016
• Between then and March of 2017 it was business as usual, and then the UK served their withdrawal notice
• Invoked article 50 of the Treaty on European Union which sets out a 2 year plan to leave the EU
• That negotiation period expires on the 12th of April 2019
• The leaving agreement must set out arrangements for withdrawal
• The agreement must then go through a few bureaucratic systems

So what is behind all the mess?

• UK conservative party lead by Terresa May
• They established the department for International Trade (DIT)
• There has been a lot of back and forth between the UK and the EU
• The UK is being made an example of
• 2 years down the track, where are we now?
• The EU has been the better negotiators even though the UK is in the position of power
• The contents of this agreement are only that it sets up a transitional period of further deliberation to be in the EU until December 31st, 2020
• This is essentially the UK still being apart of the EU but without a vote
• How has the deal been going in UK parliament?

Failure to negotiate:

• Article 50 provides for a negotiated withdrawal
• If there is no deal, The EU treaties cease to apply
• The EU technically can’t block them from leaving
• If there is no agreement, then trade falls back onto the world trade organization rules on tariffs and trade
• The EU operates similarly to a cartel
• What is Gibraltar?
• The financial sector seems to benefit more from being a part of the EU
• Why is it so beneficial for Financial services to be a part of the EU?
• The UK is now ranked the 2nd largest global conduit for corporate tax haven policies

Summary of the racket:

• Firms will set up a letterbox office in the City of London
• Then there will be subsidiaries in other EU countries
• One charges the other for intellectual property, and you essentially write off profits
• You have other countries wanting to do trade deals with the UK, without going through the EU

Next Friday:

• Finish off the series
• How the tax racket works
• Who is behind the “grass roots” remain protest organisations

Thank you for listening, if you want to get into contact you can do so here.