TAXTOPIA: How I Discovered the Injustices, Scams and Guilty Secrets of the Tax Evasion Game
Synopsis
In TAXTOPIA a rogue accountant breaks ranks to share his journey from clueless naif to skilled tax consultant -and in doing so blows the lid on the murky world of making the tax burdens of the ultra-wealthy disappear. In the topsy-turvy world of tax avoidance, you can get richer by buying a yacht, the world's biggest exporter of coffee is Switzerland, and billionaires like. Jeff Bezos, Donald Trump and the Duke of Westminster often pay less tax than you do.
Written with sharp wit and over-brimming with inside secrets, the anonymous author shows us that not only does the global tax system encourage dubious practice which favours the rich, but that it was specifically founded with that in mind. If you suspect that tax is a rigged game, a con, designed to fleece the little guy, you are about to find out just how shockingly true that really is.
- Publisher: Octopus Publishing Group
- ISBN: 9781800960886
- Number of pages: 368
- Weight: 620g
- Dimensions: 236 x 156 x 36 mm
How I bulls–tted my way into a tax accounting job
Even though I had zero Australian tax knowledge, and even though it was the tail end of 2009, the global financial crash had created some giant opportunities for tax advisers.
″The Rebel Accountant” is the pen name of a British chartered tax adviser who has worked widely behind the scenes from major accountancy firms to tiny start-ups. In this extract from his new book he describes how he ended up working as an accountant and then found his way to Australia.
Even though I had zero Australian tax knowledge, and even though it was the tail end of 2009, the global financial crash had created some giant opportunities for tax advisers.
I decided to rebel against my parents. It was astonishingly difficult to do.
We lived in a posh but trendy part of London, my parents were both relaxed and liberal, had enjoyed the ’60s appropriately then sobered up in the ‘70s, squeezed out kids in the ‘80s and sent us to undemanding private schools in the ’90s.
My father had got me a job making music videos and commercials – the kind of thing that some people dream of doing. Without any effort or inclination on my part I had found myself in what was supposed to be a creative maelstrom, working as part of a team that was filming the comeback of an ’80s pop icon.
So, how to rebel? How do you do something that no one expects you to? How do you raise eyebrows and start conversations?
Yup, I became an accountant.
I’d never really thought about emigrating to Australia. True, I had a couple of friends who had moved out there about the time I decided to become an accountant and whenever I spoke to them (which admittedly, due to the 11-hour time difference, was rarely) they raved about it. The image they projected was of surfing, and “barbies”, and generally spending their whole lives in shorts. A quarter of Australia’s population was born overseas, and they suggested that this created a culture of friendliness and openness to strangers.
While the decision to move out to Australia was a challenge, getting a job was a doddle. Even though I had zero Australian tax knowledge, and even though it was the tail end of 2009 and what had started as the credit crunch had escalated into a full-scale, global depression (I suspect you remember it), with hundreds of thousands of people being laid off across every industry, one profession was still doing all right.
The global financial crash had created some giant opportunities for tax advisers, as it had created some genuine losses, and losses meant tax savings, and tax savings mean advisory fees. If anything, there weren’t enough accountants to go around.
My recruiter explained that there was a South African law firm that had been expanding aggressively internationally and was now looking for accountants to join its new corporate advisory team in Australia.
As I had officially worked in business taxes for a few years and had a brief stint in what was effectively one big front for tax avoidance, I seemed to fit the bill perfectly.
I’d never considered working for a law firm, but I was assured that it wouldn’t be much different from working for an accountancy firm. My face must have fallen because the recruiter added, “I mean it’s very different. The whole culture is different. The lawyers are all so charming. You’ll love it.”
We both knew he was lying, but we both wanted it to work. He told me the name of the firm and arranged an interview.
The law firm’s website tripped over itself to demonstrate how they were one of the goodlaw firms. They sponsored educational programmes for deprived children, hosted pro bono drop-in centres in underprivileged neighbourhoods, and supported cultural institutions in every city in which they operated (which was about a dozen). Maybe I should have stopped reading there. But I didn’t want to get caught out again in a job interview. If my Australian tax knowledge wasn’t (yet) great, then at least I could show an understanding of what this law firm actually did.
There was a case studies section. There were beautiful photos of rainforests, and accompanying text on the great work the law firm did on sustainability. There were smiling construction workers in hard hats, with a blurb about health and safety.
And there was a photo of the stunning Australian outback, under which the website described the work the firm did on understanding the land rights of indigenous peoples, in particular a case about Aboriginal Australians claiming the rights to an area of desert that had recently been found to be very resource-rich. An international mining company claimed that the land was not, in legal fact, owned by the Indigenous people who lived there (I think on the grounds that the mining company got there first).
This all sounded great. I could live in Australia, learn to surf, get paid some decent cash and brag about working on sustainability, Indigenous land rights and, um, health and safety.
You may well have realised already what I only realised later – frankly, too much later.
Sustainability was the enemy. Logging companies were trying to cut costs and environmental commitments are expensive. Health and safety checks slow down construction projects, which is especially galling in those parts of the world where concrete costs more than labourers. And the Indigenous people were not this firm’s clients. The mining company was.
By the time it became apparent that most of the firm’s clients had at various stages been Bond villains (I’m not ruling out the possibility that some of them had built space lasers), I was already settled into a new routine of having my barista-made coffee brought to me each morning at a desk that looked out over the city from 20 floors up.
And the firm was at pains to point out that everyone deserves legal representation, even Bond villains.
To begin with, most of the work I was asked to do in my new job was fairly routine. A lot of wealthy Australians had lost money as global stock markets tanked, and they were taking the opportunity to sell their assets at a loss (usually just enough assets were sold to offset gains they’d accrued on other things), then repurchasing those same assets via a Singaporean company. Singapore charges no capital gains tax, so effectively the wealth was shifted to a regime that wouldn’t tax that wealth, and shifted in such a way as to avoid tax.
In the UK there are so called “anti-avoidance” provisions to prevent a Brit owning an asset through an offshore company in order to circumvent the tricky issue of legally owning the asset, and consequently shirking responsibility for paying taxes on that asset. I asked the Australian lawyers if there were similar laws in Australian statute.
“This is absolutely fine, mate, don’t worry about it.”
That didn’t exactly answer my question about the legality of what we were doing, but I followed their advice and didn’t worry about it.
To get the job in the first place I had to demonstrate a detailed understanding of the differences between UK taxes and Australian ones. Luckily, the Australian tax system is broadly based on the British one – as indeed are many of the world’s tax systems (though an inherently corrupt tax system is hardly the worst legacy of our empire), but even more luckily there was a “featured” (meaning “very thorough”) article on Wikipedia called “The Australian Tax System”.
A quick scan through the article was enough to bluff my way through the interview.
Most of my new job involved dressing smartly, escorting the finance directors of large companies into our high-end offices, making small talk about cricket and then sitting politely as my boss explained how they could, ahem, restructure their affairs so that they paid less tax. I understood more about the tax than about the cricket, but that’s not saying much.
My new boss was called Hal. He had a directness and frankness that was refreshing to me as a Brit, but also educational in terms of how to deal with recalcitrant clients.
One company director in particular seemed to be looking for every reason not to sign up to our firm.
“I appreciate this is legal,” he said, having had the legality of Hal’s suggestions reiterated in every possible form, “but is it ethical?”
This was the first time in almost five years of being an accountant that I’d heard a client ask this question. Maybe Hal had been asked this before, as he had a reply up his (short) sleeves.
“Mate, you’ve got a fiduciary duty to your shareholders to maximise their wealth. It’s unethical not to take every tax saving you can.”
The director looked unconvinced. “I’m the sole shareholder,” he said. But Hal had a response to that, too.
“You’ve also got a duty to your employees. If your company goes bust because you’ve run out of money because you’ve handed it all to the taxman, then your employees won’t be able to feed their kiddos, and that’ll be on you.”
Ah yes, think of the children.
Luckily that director did think of the children, and signed up with our firm.
Taxtopia: How I Discovered the Injustices, Scams and Guilty Secrets of the Tax Evasion Game by The Rebel Accountant (Monoray).
