Many years ago I had passing contact with a company that operated as a sub-contractor for most of the big oil companies.
Whenever a possible new source of oil was suspected, the company was contracted to send out teams of surveyors to map out a seismic survey of the site.
The surveyors employed were of all nationalities and worked in all parts of the world – sometimes for months or even years at a time and often transferring from one site to another without ever visiting their own country at all.
A vital part of head office structure was a finance department who advised on a day to day basis, the best currency to invoice their clients in and the best bank and country into which the fee should be paid.
On the move
All of course depending on the tax regime and financial stability of the selected country and on the market value of the currency – on a moment to moment basis. And they offered the same service to their own widely scattered employees.
The amount of tax paid to HM government was – as with so many companies – a matter of negotiation. A matter of how far the tax inspectors could push before the company simply upped sticks and left for greener pastures.And nothing to do with actual profits.
For there was no need for this company to operate from the UK at all. Even in those pre-electronic days fax machines, copiers, telephones and good old surface mail meant that head office could transfer to any country of choice if they decided the tax regime was more suitable. More easily manipulated.
As with this anonymous company so with all major – which means international – companies. Especially now when funds and information manipulation don’t even require a central head office.
Money always flows
In every minute of every twenty four hour day, a flood and ebb of money flows from country to country and from currency to currency.
So for some minor politician in some cash-strapped parliament to threated financial punishment for the greedy is merely to generate much laughter.
The wealthy so condemned, will pay such tightly negotiated fines as will buy them release from harassment, then carry on as before. The politician will issue fiery speeches celebrating his non-victory; and all will be forgotten till another general election spurs another politician to once again threaten dire reprisals against the greedy. And the multi-millionaires, entirely unaffected, will shrug off just another of those unfortunate trading losses one has to compensate for from time to time.
Image: Kevin Dooley under CC BY 2.0
