With or without tax

Bono (Paul David Hewson) defends the U2’s tax avoidance in the Irish Times‘ weekly entertainment supplement, the Ticket. While fellow U2 band member the Edge (ie David Howell Evans) says its “it’s our own private thing.”

First, the Edge may have a leg to stand on, but Bono doesn’t due his campaigning relating to aid.

Now, on to Bono’s defence.  He says: “We pay millions and millions of dollars in tax.” So what? How much do U2 make? Just because U2 pay millions does not mean they should not pay their fair share.

Or, if we were to measure U2 against Bono’s own campaigning, those who can afford to give more should do so.

Let’s get this clear, U2 can afford to give more in tax. And if we’re to go down the road of “sure, they give loads away anyway” does that mean anybody who gives money away should be able to pay less, or even no, tax?

Bono goes on, he says:

“I can understand how people outside the country wouldn’t understand how Ireland got to its prosperity, but everybody in Ireland knows that there are some very clever people in the Government and in the Revenue who created a financial architecture that prospered the entire nation – it was a way of attracting people to this country who wouldn’t normally do business here. And the financial services brought billions of dollars every year directly to the Exchequer.

“What’s actually hypocritical is the idea that then you couldn’t use a financial services centre in Holland. The real question people need to ask about Ireland’s tax policy is: ‘Was the nation a net gain benefactor?’ and of course it was – hugely so. So there was no hypocrisy for me – we’re just part of a system that has benefited the nation greatly and that’s a system that will be closed down in time. Ireland will have to find other ways of being competitive and attractive.”

There’s a number of problems with this. And it’s not clear why ‘dollars’ is used, you pay Irish tax in euro.

Saying “we’re just part of a system” could justify pretty much anything. Including, say, not helping the poor of the world.

Bono does not seem to make any firm judgement on what has been happening in Ireland. But others have. Writing on the Guardian‘s Comment is Free today Irish Times journalist Fintan O’Toole says “A globalised brand of cute hoorism has been created by state policy”. He adds:

“Thus, for the sake of a handful of jobs, Ireland facilitates the avoidance of taxes by British corporations. And we do this as part of a mentality that has grown with the International Financial Services Centre – the notion that lax regulation is part of our competitive advantage. The IFSC has been a great cash cow for the Irish exchequer, and provided up to 20,000 jobs. But its very success has also encouraged a deep reluctance to ask too many questions about the flow of money in and through Dublin.

And companies from other countries, I’d add, as O’Toole’s article was writing it relation to the tax avoidance articles the Guardian has been runing recently.

Bono is being a hypocritical. U2 as a whole are not. The other band members are not. Nor is their manager. Just Bono. He is asking for more tax payers’ money to go to the poor while he is party to tax avoidance. Let the middle and lower classes pay, but not the rich. Or in, U2’s case the super rich.

If he was following his own preachings he would not have allowed U2 to set up in the Netherlands for tax avoidance when there was a cap put on tax-free earnings for Ireland-based artists. If needed, he would have stud up against the rest of the band, or the band’s manager, Paul McGuinness, or anybody who was set on making the move. And if Bono did not have a clue about the move before it happened, then somebody in U2 management should have known it would have damaged Bono’s image sooner or later.

The Edge says “we are totally tax compliant.” Indeed, nobody is claiming U2 is avoiding tax, which is illegal.  Tax avoidance is legal, but is it right?

In the same vain: There are no laws against turning a blind eye to poverty, but is it right? Many of the things which made the downturn worse were 100% compliant with the law, but were these right?

If — as O’Toole points to —  state policy has caused a system of “cute hoorism,” then U2 are surely part of this. As Bono said:  “we’re just part of a system.” Can Bono honestly defend this when he is looking for change in where tax is directed to?

See the interview in full ‘Just the 2 of U‘, and the related main-section cover st0ry ‘Bono ‘hurt’ by criticism of U2 move to Netherlands to cut tax’, ‘Bono rejects criticism of U2 tax status‘ (which also made it as a breaking news story ‘Bono rejects criticism of U2 tax status‘).

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