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Chase Bank Limits Cash Withdrawals, Bans International... Before you read this report, remember to sign up to http://pennystockpaycheck.com for 100% free stock alerts Chase Bank has moved to limit cash withdrawals while banning business customers from sending...

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Richemont chairman Johann Rupert to take 'grey gap... Billionaire 62-year-old to take 12 months off from Cartier and Montblanc luxury goods groupRichemont's chairman and founder Johann Rupert is to take a year off from September, leaving management of the...

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Cambodia: aftermath of fatal shoe factory collapse... Workers clear rubble following the collapse of a shoe factory in Kampong Speu, Cambodia, on Thursday

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Spate of recent shock departures by 50-something CEOs While the rising financial rewards of running a modern multinational have been well publicised, executive recruiters say the pressures of the job have also been ratcheted upOn approaching his 60th birthday...

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UK Uncut loses legal challenge over Goldman Sachs tax... While judge agreed the deal was 'not a glorious episode in the history of the Revenue', he ruled it was not unlawfulCampaign group UK Uncut Legal Action has lost its high court challenge over the legality...

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MEPs set up new EU budget battle

Category : Business, World News

Euro MPs demand further negotiations on the EU’s multi-year budget, amid tensions with austerity-minded governments.

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It’s not wrong to avoid tax | David Giampaolo and Geoffrey Wood

Category : Business

Moralisers take note: the more money firms pay the state, the less they have to spread around

Why is it unethical to comply with the law? That is precisely what anyone who claims a company is immoral if it legally minimises its tax is saying. That is what anyone who boycotts Starbucks, or any other multinational company, is saying. The protesters – who have vowed to continue their action even though Starbucks agreed to pay £10m in taxes in each of the next two years – seem to be setting themselves above the law.

First of all, what place does morality have in this? There are some universally agreed moral principles – do not kill is pretty widely accepted – but does this really fall into the same category? Is it right, for example, to have a friend round to dinner rather than send some money to feed the hungry? Some will say one thing, some another. Universal moral principles are of the greatest importance, but are not a guide to every detail of life.

And in practical terms, companies actually do not bear the burden of a tax. Companies are not individuals. They are organisations designed to produce and supply things. They employ people, machinery, intellectual property, capital, raw materials, and so on, and combine them to produce things for people. Companies are intermediaries.

If a company has to pay as tax some of the money it makes from selling its output, that leaves it with less to distribute. So it pays less to shareholders, employs fewer workers, and buys less in the way of raw materials. And of course it makes and sells fewer goods. In other words, some of the profits may be handed over by the company, but the burden is borne by the company’s shareholders, employees, suppliers, and customers.

Note too, that much tax is paid in consequence of the activities of companies; income tax, capital gains tax and, in many countries, sales tax (VAT in Britain, and also national insurance here). That is one of the reasons governments try to produce tax regimes designed to attract businesses. Those who complain about tax avoidance by companies should see that the more tax a company avoids, the more tax its owners and employees will pay. Criticising corporations for avoiding tax is actually criticising them for doing what governments want. Governments all round the world compete to provide favourable tax regimes for business. They accept the phenomenon of legitimate tax avoidance, taking advantage of the tendency in, for example, efforts to incentivise pension saving, or industrial development in particular regions.

Governments also engage in tax competition to attract firms. They do that to bring jobs, investment, and innovation to their countries, with all the benefits that can spill over from those to the rest of the economy. Companies follow such tax incentives because if they can conduct their business with decisions unaffected by tax paid by the business, then they can operate as efficiently as they can and let the taxes on the outcome be paid by the individuals who actually benefit from that outcome – the shareholders, employees, and suppliers.

When companies do what is legal to minimise the taxes they pay, they are actually doing what governments want them to – they are responding to incentives. If governments complain about this, it may be because the structure of the business is not what they thought or because they have made taxes so complicated that there are numerous ways to avoid them. Governments may want money in difficult times, but companies can use it too, to create jobs.

As the president of the CBI remarked of the agitation over taxes, “If you want different results, you have to have a different set of rules.”

In thinking about these rules, politicians, and others concerned about the taxes companies pay, should remember the advice of two politicians of earlier generations. When he was chancellor of the exchequer, Nigel Lawson said that taxes should be “low, simple, and compulsory”. Tax competition helps keep taxes low. If politicians want taxes to yield what they expect – want them to be compulsory – they should keep them simple, not make them so complex that the result is a surprise. And on morality they might heed the words of a former prime minister, the late Harold Macmillan. Politicians, he said, should “leave morality to the bishops”.

David Giampaolo is chief executive of Pi Capital. Geoffrey Wood is professor emeritus of economics at Cass Business School and the University of Buckingham

Robin Hood tax gains traction in Europe

Category : Business, Stocks

Supporters say the controversial move will raise billions of euros for cash-strapped governments by applying a small tax on transactions in financial markets.

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2012 BCG e-Intensity Index Documents Widening Digital Divide

Category : World News

Governments Need New Approach to Policymaking to Reap Internet’s Advantages for Their Countries

Excerpt from: 2012 BCG e-Intensity Index Documents Widening Digital Divide

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Media Advisory: It’s time to press "play" on the economy and stop blaming working people

Category : Stocks, World News

NORTH BAY, ONTARIO–(Marketwire – Aug. 31, 2012) - It’s time for governments to take their fingers off the “pause” button and to get Ontario’s economy rolling, say the leaders of the Canadian Union of Public Employees (CUPE) Ontario, which represents the people who provide front-line services in communities across the province.

Original post: Media Advisory: It’s time to press "play" on the economy and stop blaming working people

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More on the ECB: Mario Draghi appears to have won over at least one Bundesbank member as Jorg Asmussen tells a German newspaper high peripheral bond yields reflect exchange rate risk, thus "our monetary policy (is) achieved only…

Category : World News

More on the ECB: Mario Draghi appears to have won over at least one Bundesbank member as Jorg Asmussen tells a German newspaper high peripheral bond yields reflect exchange rate risk, thus “our monetary policy (is) achieved only incompletely.” It’s crucial wording, suggesting he’s okay with ECB bond purchases as long as they’re couched in saving EMU, not financing Spanish and Italian governments. “We are working on (a) new program and will deal with it (at the next policy meeting).” 6 comments!

Here is the original post: More on the ECB: Mario Draghi appears to have won over at least one Bundesbank member as Jorg Asmussen tells a German newspaper high peripheral bond yields reflect exchange rate risk, thus "our monetary policy (is) achieved only…

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Rate cuts lift China home prices

Category : Business, World News

Property prices in China rise in July amid cuts in borrowing costs and after some local governments ease restrictions on purchases.

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Fat chance of war over the Arctic’s resources

Category : World News

Russian television contacted me the other night asking me to go on a program about the race for Arctic resources. The ice is melting fast, and it was all the usual stuff about how there will be big strategic conflicts over the seabed resources — especially oil and gas — that become accessible when it’s gone.
The media always love conflict, and now that the Cold War is long gone, there’s no other potential military confrontation between the great powers to worry about. Governments around the Arctic Ocean are beefing up their armed forces for the coming struggle, so where are the flash-points and what are the strategies? It’s great fun to speculate about possible wars.

The rest is here: Fat chance of war over the Arctic’s resources

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Canadians lack confidence governments can solve issues

Category : World News

As premiers gather for their annual Council of the Federation meeting in Halifax, a new Institute for Research on Public Policy-Nanos Research survey suggests a lack of confidence in the ability of governments to solve pressing issues like health care and balancing budgets.

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Economists Menzie Chinn and Jeffry Frieden argue that as debt is the major factor dragging on economic growth, inflation should be allowed to rise. This "would reduce the real burden of debt on households, corporations and governments, spurring…

Category : World News

Economists Menzie Chinn and Jeffry Frieden argue that as debt is the major factor dragging on economic growth, inflation should be allowed to rise. This “would reduce the real burden of debt on households, corporations and governments, spurring both investment and consumption.” However, while the Chicago Fed’s Charles Evans supports the idea, Ben Bernanke doesn’t. (Summary) 5 comments!

Originally posted here: Economists Menzie Chinn and Jeffry Frieden argue that as debt is the major factor dragging on economic growth, inflation should be allowed to rise. This "would reduce the real burden of debt on households, corporations and governments, spurring…

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