Does Merlin Entertainments dodge tax?

[Tom]

I am genuinely asking here (as opposed to attacking) as I don't know entirely how this all works, but:

After reading and listening to so much about the questionable tax practices of Starbucks, Facebook etc and how they are able to do this by shifting money about from one part of the company to another, I was wondering if Merlin are also able to avoid certain taxes in the same way.

We know Merlin likes to call itself a 'group' as opposed to a company or business and is structured into many different 'divisions'. Is this all primarily for the reasons of tax avoidance? We also know that Alton Towers gets 'charged' by Merlin Studios for things such as signage and goodness knows what else. We've also seen balance sheets that show Alton Towers as not making much of a profit or operating at a loss.

If Merlin were avoiding tax in a questionable (if not illegal) way, it would make their VAT-slashing campaign appear all the more selfish.

 

[EuroSatch]

The ultimate holding company is in Luxemburg, and all the attractions operate as "agents". Both are legitimate accounting practices, but I would hazard a guess that it also aids in the amount of tax they don't pay

 

[Natalie]

In the accounting world it's called window dressing, it is slightly frowned upon when I was taught about it when I was taking my AAT's but it's not illegal. If you pay all your bills or buy a large rollercoaster before your tax bill is due and it leaves you not making much then you won't have to pay as much. This is why accountants who specialise in tax earn large amounts of money due to the money they save their clients, this is why I want to train in this sector of accounts.

 

[TheMan]

I alluded to this in a previous post, when discussing profitability etc.

Your mind would bend at how many ways there are for a big company, backed by massive venture capitalists to avoid paying much tax.

Back in the days when I worked around "The City", I worked directly alongside a top consultant for Pricewaterhouse Coopers. These guys make serious, serious money - and there is a jolly good reason for it.

You can bet your bottom dollar, they're paying as little as possible whilst still bleating on about VAT.

I honestly think that this bleeting, alongside the tripe about Free Museum leaves me viewing Varney as quite cretinous truth be told.

Is it legal, most certainly - is it moral? Most certainly not.

 

[Stelios]

Who doesn't?

 

[Tom]

I'm not really concerned whether it's legal or not, it clearly is immoral. The question is will anyone dare to tackle it, I seriously doubt a pro-business Tory-led government would.

 

[TheMan]

I honestly cannot stand the Tories.

However, no government has had the bottle to tackle the big business issues, or food issues, or any real issues for that matter.

They are politicians, if they had that mindset of how to deal with it, in all probability, they'd be running their own companies not spending their lives barking orders at those they supposedly represent.

I think the power is in the hands of the consumer, don't buy - but who would actually go that far?

Agree with you though Tom 100%. It's what you do about it, and how.

 

[Islander]

You can bet your bottom dollar, they're paying as little as possible whilst still bleating on about VAT.

I honestly think that this bleeting, alongside the tripe about Free Museum leaves me viewing Varney as quite cretinous truth be told.

Think it would be wise to be a tad careful here, and avoid accidentally starting false rumours - this post does kinda come across as "Merlin are doing a Starbucks!!", when of course there is no proof of that. Whereas Tom's original post took an "are Merlin doing this?" slant, your's very much seems to take the "Merlin are doing this" slant...

 

[TheMan]

I appreciate what you're saying Islander, but I have not suggested they're doing anything illegal.

This is business, big, big business. They pay the best accountants and awful lot of money to pay as little tax as possible. If there are ways to do this, they are within their legal rights to do so.

The comments about VAT are everywhere, they started their own campaign based on wanting to pay less tax, so my suggesting they'll be doing what they can, legally I might add, to pay as little tax as is possible - whilst to clarify, is certainly a personal opinion, - is derived from their own marketing based on their public attitude towards paying a tax every person and business has to pay to live or operate in the UK.

Where there are loopholes, accountants will use them (not all). It is not up to the businesses or accountants to stop them either. They do not have a moral duty to do so.

I am also conveying my opinions as a dissatisfied customer, given the method in which they have chosen to publicly declare their position on the matter.

But no, certainly not accusing them of anything illegal. Anything else I am entitled to speculate upon, based on the figures/statements that are released to the public.

And as I said also in anther thread I think, what business wouldn't do this...

they're paying as little as possible

I used Amazon and Starbucks of examples as to how multinationals can move money around the company, to balance global performance, and save on overall tax bills.

Point taken though, but I hope that clarifies the matter. These are just opinions of course, of which we're all entitled.

We should not have to be concerned about discussing this, as long as we are not accusing people of things that are illegal, which I most certainly am not.

We're in trouble as a nation if we can't do that.