Are Bono's tax affairs any of my business?

[Brendan Burgess]

The Irish Times is reporting on stuff found in the Paradise Papers relating to Bono.

Why do they do that?

If they found evidence of criminal tax evasion, then they would probably be right to do so.

I can sort of understand why the Queen's tax affairs might be a matter of public interest.

But why Bono's?

If it shows him to by a hypocrite for calling on world governments to spend more money on fighting hunger, then maybe so. But we know his management company used Holland to plan their taxes.

We are a tax haven in Ireland for large multinationals and financial services companies.

Should we not dismantle this tax haven status if we want to comment on other offshore tax havens?

Askaboutmoney is full of posts which suggest to people how they might legitimately reduce their tax. Give €3,000 a year in gifts to avoid CAT; Don't give gifts while you are alive to avoid CGT.

If there were some scheme whereby I could legitimately start an investment in Bermuda which reduced my income tax or CAT, presumably it would be ok to do it. I would not want the Irish Times to be reporting that I had money in Bermuda, as it wouldn't be anyone's business.


Brendan

 

[odyssey06]

Bono's affairs certainly are a matter of public interest because he has made them so by virtue of his political statements.

He is engaged in business transactions in the public sphere therefore these transactions should be open and transparent.
If he isn't doing anything wrong, why does he wants his dealings to remain in the shade?
If he is concerned about public criticism, then stop engaging in legal but shady deals.
The information that is disclosable should not be of benefit to competitors is one limitation I would apply, but that doesn't seem relevant here.

Giving a gift is not a business transaction and we have no public interest in it as long as it is being used legitimately.
But If I buy a house from another private citizens the transaction amount is recorded on the property price register because this is of public interest.

 

[Brendan Burgess]

He is engaged in business transactions in the public sphere therefore these transactions should be open and transparent.

So, if I invest in your business, should this be a matter of public record?

If he isn't doing anything wrong, why does he wants his dealings to remain in the shade?

I am not doing anything wrong in opening a bank account in Ulster Bank in Newry. But if UB is hacked, I don't want my private affairs a matter of public record.

If I buy a house from another private citizens the transaction amount is recorded on the property price register because this is of public interest.

I have always thought that this was a bit odd. It's a Residential Property Price Register. If I buy an office for €50m, it's a private deal. Presumably my ownership of it will be on the Registry of Deeds somewhere, but the price I paid for it won't be.

Bono's affairs certainly are a matter of public interest because he has made them so by virtue of his political statements.

Yes, this was the only justification I could see, but I didn't see the Irish Times making this connection.

 

[odyssey06]

So, if I invest in your business, should this be a matter of public record?

From https://www.theguardian.com/news/20...-lithuania-shopping-centre-u2-paradise-papers

The U2 frontman used a company based in Malta to pay for a share in a shopping centre in a small town in the north-east of the country, the Paradise Papers reveal.

The singer, whose real name is Paul Hewson, was an investor in the Maltese company which bought the Aušra mall – named after the Lithuanian word for dawn – for €5.8m (£5.1m) shortly after it opened in 2007.

I don't see why any of the above information shouldn't be in the public domain regardless of whether it's Bono, or some other unfamous Paul Hewson.

We should know the owners of a property, and if that is a front company, we should know who the real people are behind it.

The same should apply if it is somebody non-Irish Judge Judy or just plain old Jane Smith from Noo Yawk whose front company has brought Dundrum shopping centre.

 

[T McGibney]

We should know the owners of a property, and if that is a front company, we should know who the real people are behind it.

Not necessarily in all cases. Commercial confidentiality and secrecy is often of vital importance to free trade.

In my hometown of Cavan, a cartel of local professionals and bigwigs over several decades routinely blocked newcomers from buying commercial premises and setting themselves up in competition to established incumbents.

If it became known that a young doctor, dentist, solicitor or draper was sniffing around an available property, they would find themselves silently blackballed. There are many successful Cavan people in Dublin whose attempts to set themselves up at home were frustrated by this racket.

It only became obsolete when it became possible to buy through an intermediary using a front company or trust. And Cavan wasn't untypical of Irish country towns back then.

 

[odyssey06]

Not necessarily in all cases. Commercial confidentiality and secrecy is often of vital importance to free trade.
In my hometown of Cavan, a cartel of local professionals and bigwigs decades routinely blocked newcomers from buying commercial premises and setting themselves up in competition to established incumbents. There are many successful Cavan people in Dublin whose attempts to set themselves up at home were frustrated by this racket. It only became obsolete when it became possible to buy through an intermediary using a front company. And Cavan wasn't untypical of Irish country towns back then.

Aren't cartels illegal?
And isn't one way of building cartels creating front companies to shield that real ownership is all in the hands of a single group?

And in your scenario, the commercial confidentiality and secrecy seems necessary during the purchase... I don't see any reason why 12 months later it'd be necessary to keep the real owners under wraps.

 

[T McGibney]

Aren't cartels illegal?
And isn't one way of building cartels creating front companies to shield that real ownership is all in the hands of a single group?

And in your scenario, the commercial confidentiality and secrecy seems necessary during the purchase... I don't see any reason why 12 months later it'd be necessary to keep the real owners under wraps.

So what if cartels are illegal? Just because something is illegal doesn't mean it doesn't happen. And its rather fanciful to suggest that all property acquisitions and business venture startups can be concluded within 12 months. How long has the apparently doomed Apple Athenry project been in the works?

 

[odyssey06]

So what if cartels are illegal? Just because something is illegal doesn't mean it doesn't happen.

If cartels are illegal, then the authorities should be busting them.
I don't see why we need veils of secrecy to get around them especially when those veils of secrecy can just as easily be used to create cartels.

And its rather fanciful to suggest that all property acquisitions and business venture startups can be concluded within 12 months.

Where did I suggest that? I said 12 months later than the property acquisition.
If the property isn't acquired why would we need to know about it?

 

[T McGibney]

then the authorities should be busting them.

The country is riddled with small and big cartels. How many prosecutions for competition law violations in the past 10 years?

Where did I suggest that? I said 12 months later than the property acquisition.
If the property isn't acquired why would we need to know about it?

How would that work for the likes of Applegreen, Aldi and Lidl who are continually on the lookout for new sites around the country and who may wish to use front companies to protect themselves from ripoffs and cartel blocks at enquiry and bidding stages?

 

[odyssey06]

How would that work for the likes of Applegreen, Aldi and Lidl who are continually on the lookout for new sites around the country and who may wish to use front companies to protect themselves from ripoffs and cartel blocks at enquiry and bidding stages?

Why would they need to keep secret that they own a site 12 months after they have purchased it???

 

[cremeegg]

Getting back to the question. My answer is yes for a reason that has not been mentioned so far.

The IT report exposes the nature of the type of transaction that can be engaged in to minimise tax. If Paul Hewson wished to buy a shopping centre in Lithuania it should not be more tax efficient for him to do so via some third entity in Malta.

The public has an interest in (although it is probably bored to tears by) the nature of these schemes and the tax savings that can be made. Otherwise how will there ever be change to ensure that everybody pays tax on the same basis.

The public's interest is attracted by the fact that its Bono.

 

[T McGibney]

Why would they need to keep secret that they own a site 12 months after they have purchased it???

Because property development is complex and subject to planning and other delays. Unnecessary rules merely drive up costs for everyone.

 

[T McGibney]

The IT report exposes the nature of the type of transaction that can be engaged in to minimise tax. If Paul Hewson wished to buy a shopping centre in Lithuania it should not be more tax efficient for him to do so via some third entity in Malta.

Because Malta presumably enjoy sovereignty to set their tax laws as they see fit. As do we.

 

[cremeegg]

Because Malta presumably enjoy sovereignty to set their tax laws as they see fit. As do we.

I am sure you are correct, but I do not understand your point.

If it is the case that Irish taxes can be reduced by using legal entities in other countries, perhaps the future legality of this process is something that should be the subject of public debate.

Reporting the use of these procedures by public figures may prompt this debate. A good thing in my opinion.

 

[T McGibney]

I am sure you are correct, but I do not understand your point.

If it is the case that Irish taxes can be reduced by using legal entities in other countries, perhaps the future legality of this process is something that should be the subject of public debate.

Reporting the use of these procedures by public figures may prompt this debate. A good thing in my opinion.

We cannot unilaterally jettison an entire system of international tax residence treaties, especially as our own employment numbers and public finances are heavily dependent on exploiting them for our own purposes.

The EU want an end to national tax sovereignty. We will be in serious bother if that ever comes to pass.

 

[Gordon Gekko]

Reporting the use of these procedures by public figures may prompt this debate. A good thing in my opinion.

Who constitutes a “public figure”?

Why should someone’s private (and legal) business become fodder for the media and populists?

In my view, even the Property Price Register is a gross invasion of privacy.

I’ve even heard some left-leaning journalists suggest that tax returns should be made public; disgraceful stuff.

 

[dub_nerd]

The public's interest is attracted by the fact that its Bono.

Exactly. Which means it's just a case of a newspaper profiting from idle gossip and appealing to characteristic Irish begrudgery. I watched the BBC Panorama programme on the Panama papers last night. It, too, amounted to "rich people use all legal means to avoid tax". Who knew!


Quick poll -- hands up everyone who pays more tax than they have to?

... hmmm. Thought so.


If we don't like tax havens we should be focusing our attention on the legislation that allows them to be used, not on the people who use them (and would be idiots not to). Also maybe consider the fact that we are a tax haven ourselves, before we start accusing Bono of hypocrisy.

 

[cremeegg]

We cannot unilaterally jettison an entire system of international tax residence treaties, especially as our own employment numbers and public finances are heavily dependent on exploiting them for our own purposes.

The EU want an end to national tax sovereignty. We will be in serious bother if that ever comes to pass.

These are important points in any debate over tax policy.

In my own opinion multinational corporations effective tax rates are too low. This essentially arises by their use of different jurisdictions to generate revenues, (say Germany) and report profits, (say Ireland).

While Ireland may be a net beneficiary of the present system, the greater public good on an EU wide basis requires that multinationals pay reasonable rates of corporation tax. Ireland should lead this discussion otherwise we may find the world changing without our input.

 

[odyssey06]

If we don't like tax havens we should be focusing our attention on the legislation that allows them to be used, not on the people who use them (and would be idiots not to). Also maybe consider the fact that we are a tax haven ourselves, before we start accusing Bono of hypocrisy.

Bono is a hypocrite because he lectures people vastly poorer than himself than they should be paying more in tax to help people even more vastly poor than Bono - while doing absolutely everything he can to minimise the tax he pays and using mechanisms that are not available to those poorer people.
He is a textboox definition case of a hypocrite and he has lost all respect in the eyes of many Irish people for this conduct. And in my view, deservedly so.
If Bono wants to conduct his business that way fine, but he loses all moral justification for his crusades in doing so and should either put up and pay his taxes here or shut up lecturing Irish people. It sounds like he should be lecturing the people of the Cayman Islands to contribute more to the third world.

 

[cremeegg]

If Bono wants to conduct his business that way fine, but he loses all moral justification for his crusades in doing so.

Absolutely, we should not support the developing world because Bono tells us we should and he is a hypocrite.