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Hebdomad · 30 Apr 2008, 13:11

The corporation ruse is quite popular in the UK apparently. I was speaking to an old friend who wanted his employer to put him on a contact instead of a salary. Then he'd set up his own company (which is just a matter of paperwork and doesn't cost too much), which his employer would use to pay him instead of paying him directly. He'd do this because there are significant tax breaks for "companies." I think he'd thought about the moral problems of this because he soon injected, "everyone's doing it!"

If you wanted to really make profits from this, you'd go to the Isle of Man; there's a reason HSBC has a lot of its operations on the Isle of Man. The Isle of Man is quite a good option, too, because it's doesn't look as dodgy as placing all your cash in some country few people have heard about and a country that's not renowned for its banking prowess (read: as opposed to a posh tax haven).

Anyway, essentially the social problem comes down to whether you believe in trickle-down economics or not. I've a bias against trickle-down economics; but I'm far from sure of my position. Essentially, from what I can tell, the trickle-down economics argument has to centre on the argument that providing tax breaks engenders the creation of more businesses. More businesses mean more jobs. More jobs means more income.

(There's also the argument that tax breaks will persuade businesses to give up their offshore financial accounts and place their money back in the country where it'll receive at least some taxation, but that's largely peripheral to the trick-down economics arguement.)

The trickle-down economics argument, however, seems assumes those receiving tax breaks will reintroduce their money into the country/market to create more businesses (thus jobs) and more demand for more houses, etc. However, most people use their wealth as a positional good i.e. "shit, check out how much more money i have than you", and the majority of corporation wealth falls upon a small number of individuals who produce much less demand than a large number of people with a moderate amount of wealth.

30 Apr 2008, 13:11	#23
Hebdomad I ♡ ☠ Join Date: Oct 2006 Posts: 834	Re: Child poverty in the UK The corporation ruse is quite popular in the UK apparently. I was speaking to an old friend who wanted his employer to put him on a contact instead of a salary. Then he'd set up his own company (which is just a matter of paperwork and doesn't cost too much), which his employer would use to pay him instead of paying him directly. He'd do this because there are significant tax breaks for "companies." I think he'd thought about the moral problems of this because he soon injected, "everyone's doing it!" If you wanted to really make profits from this, you'd go to the Isle of Man; there's a reason HSBC has a lot of its operations on the Isle of Man. The Isle of Man is quite a good option, too, because it's doesn't look as dodgy as placing all your cash in some country few people have heard about and a country that's not renowned for its banking prowess (read: as opposed to a posh tax haven). Anyway, essentially the social problem comes down to whether you believe in trickle-down economics or not. I've a bias against trickle-down economics; but I'm far from sure of my position. Essentially, from what I can tell, the trickle-down economics argument has to centre on the argument that providing tax breaks engenders the creation of more businesses. More businesses mean more jobs. More jobs means more income. (There's also the argument that tax breaks will persuade businesses to give up their offshore financial accounts and place their money back in the country where it'll receive at least some taxation, but that's largely peripheral to the trick-down economics arguement.) The trickle-down economics argument, however, seems assumes those receiving tax breaks will reintroduce their money into the country/market to create more businesses (thus jobs) and more demand for more houses, etc. However, most people use their wealth as a positional good i.e. "shit, check out how much more money i have than you", and the majority of corporation wealth falls upon a small number of individuals who produce much less demand than a large number of people with a moderate amount of wealth.